CSFB Cuts Intel Estimates

Analyst Tim Mahon says PC demand thus far in the third quarter has been weaker than he expected

CS First Boston cut its estimates on Intel (INTC ). Analyst Tim Mahon expects Intel to lower its third quarter revenue guidance to the lower end of its $6.3-$6.9 billion range. He notes PC demand thus far in the quarter has been weaker than he expected, and the severity of price cuts issued on Sept. 1, combined with the strongly back end-loaded nature of the third quarter, causes him to reduce his assumptions about average selling prices as well. Mahon adds that he is not currently modeling the next corporate PC upgrade cycle until late 2003 - early 2004; he would look for a slightly less than seasonal second half of 2002. Mahon still feels consumers and corporations are increasingly satisfied with low-end and mid-level processors. The analyst cut his $0.55 2002 EPS estimate to $0.51 and his $0.80 forecast for 2003 to $0.70. He also lowered his $32 price target to $21. Mahon kept his buy rating on the shares.

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