Thomas Weisel Lowers Intel Estimates

Analyst Eric Ross thinks the chipmaker will miss its Q2 guidance

Thomas Weisel cut its estimates on Intel (INTC ).

Analyst Eric Ross told S&P MarketScope he thinks Intel will miss its Q2 guidance. He sees Pentium 4 (P4) shipments below plan. Ross originally thought the chipmaker's plan for 3.0 million unit shipments was too optimistic (he pegged shipments at 1.5 million), but now thinks shipments will come in at more like 1.0 million units. The analyst says Intel hasn't sufficiently ramped up its supply chain. Ross adds that price cuts Intel was forced to make (by rival Advanced Micro Devices, AMD ) are putting pressure on P4's average selling price and margins. He adds that AMD is gaining share as it is entering high-margin products.

The analyst cut his $0.12 Q2 EPS estimate to $0.08, his $0.55 2001 forecast to $0.45, and his $0.75 projection for 2002 to $0.65. He rates Intel market perform, and AMD buy (with a $50 price target).

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