Saturday, July 14, 2007

Tech Talk - Intel and HP

Upon reviewing Jon Markman's recent MSN article, I think Intel could be a good stock pick:

"A Cowen & Co. study found that two-thirds of large businesses and three-quarters of small businesses plan make the switch to Vista over the next 12 months after Microsoft publishes its first Service Pack...Most plan to implement Vista via new computers, not by upgrading existing machines -- leading to a surge in demand for the Intel chips that serve as their brains."

I've been tracking Intel's stock price since late last year. From last November through March of this year, the price languished at around twenty dollars. It quietly crept up to $22 in May and $24 in June. It closed trading at $25.97 on Friday. There's no reason why it shouldn't get another boost, especially if other tech stocks report earnings comparative to analysts' expectations. And that's in addition to the idea that more companies plan on switching to the Vista operating system.

Markman also offers some PC makers who stand to benefit from the Vista switch: Dell, Apple, and Sony. I'm shying away from these companies for now. One computer maker I do like is Hewlett-Packard. HP was mentioned in a recent Marketwatch article:

"'They've stabilized management, reduced costs and streamlined operations,' Scott said. 'They're more of a classic growth play now with a good sustainable upside going forward.'"

"'Their strategy is to continue to bring new products to market that successfully shifts their focus back to retail distribution,' Scott said. 'They've forced Dell, which had been concentrating on direct sales models, to enter the retail channel. It shows that they've been able to move the battle for new customers into HP's sweet spot.'"

HP closed trading on Friday at $47.25.

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