Tuesday, January 17, 2006

Joe Osha fragged by INTC

Just like his buddy Ben Lynch at DB.com, Joe Osha at Merrill Lynch downgraded AMD to sell, right before INTEL earning's release, citing strong INTEL 32 bit product roadmap in 2006 (AMD almost exited all pure 32 bit market and is in 64/32 only). Joe Osha had a buy rating on INTC. However, INTEL reported a bad quarter with revenue of 10.2 billion, only 2% above Q3, 2005, far below seasonal trend of 8%, and below its own December 2005 mid-quarter projection of 10.4 to 10.6 billion. INTEL's Q1 2006 projection is 9.1 to 9.7 billion, down 8% from Q4 2005, 3% more negative than seasonal trend of 5% down. INTEL claimed that the 3% extra was because of inventory build up. Year over year, INTEL's digital enterprise group went down 5%.

So, INTEL is doing double down here. First, it went below seasonal Q4/Q3 growth, then it will go below seasonal Q1/Q4 from the already downed Q4.

INTC crumbled after hours.

Like Ben Lynch, Joe Osha's AMD downgrade was actually an INTEL upgrade. Unfortunately, unlike his smarter German friend, Joe Osha said "we are buyers", his firm increased its INTC holdings by 15% to 22 million shares --- expect this foolish bag holder to lose quite some money. We all know INTEL is in deep dodo.

AMD is expected to report 13% higher revenue tommorrow.


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