intel

INTEL CORP. $28 (Nasdaq symbol INTC; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 5.0 billion; Market cap: $140.0 billion; Price-to-sales ratio: 2.5; Dividend yield: 3.0%; TSINetwork Rating: Above Average; www.intel.com) is the world’s largest computer chip maker. About 80% of all computers use the company’s chips.

In the first quarter of 2012, Intel’s revenue rose 0.5%, to $12.9 billion from $12.8 billion a year earlier. Recent flooding in Thailand caused a hard drive shortage that hurt computer sales. That cut demand for Intel’s chips and caused a 2.0% sales decline at the company’s PC Client Group (which supplies two-thirds of its total revenue). However, software sales jumped 137.9% following last year’s purchase of antivirus software specialist McAfee.

Without unusual items, such as costs to integrate McAfee, Intel would have earned $2.9 billion in the latest quarter. That’s down 11.0% from $3.2 billion. Earnings per share fell just 3.4%, to $0.56 from $0.58, on fewer shares outstanding.

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Vietnam has a fast-growing economy, largely thanks to its low wages and rising exports. The country’s labour and production costs are as little as one-third of similar costs in China. Plus, over 50% of Vietnam’s population of 85 million is under 25 years of age, so it has a large future labour pool. The country is steadily integrating itself into the global economy. Vietnam hosted the 2006 Asia-Pacific Economic Cooperation (APEC) summit in Hanoi. While there, President Bush visited the Vietnam stock exchange in Ho Chi Minh City (formerly Saigon) and rang a gong to open trading. Vietnam became a member of the World Trade Organization (WTO) in 2007. This gave the country’s businesses improved access to more markets and investment capital worldwide. Vietnam is a major producer of agricultural products—it’s currently the world’s biggest exporter of cashew nuts and the second-largest exporter of coffee and rice. However, the country is quickly adding manufacturing to its export base—and it’s doing that by attracting more foreign investment....

APPLE INC., $545.18, Nasdaq symbol AAPL, hit an all-time high of $548.21 this week, mainly due to speculation that the company will unveil the next version of its iPad tablet computer, the iPad 3, in the coming days. Apple has sold more than 55 million iPads since it first launched the device in 2010. Even though many of the company’s competitors now sell tablets, iPads still account for over 60% of this fast-growing market. Separately, Apple has recently agreed to let China Telecom sell its new iPhone 4S smartphone; China Telecom is China’s third-largest wireless carrier, with 15 million customers. Apple already sells the iPhone though China Unicom, China’s second-largest carrier. Apple also hopes to work out a deal with China Mobile after it upgrades its systems to handle the iPhone 4S. China Mobile is the country’s largest wireless provider, with 650 million subscribers....

POWERSHARES QQQ ETF $61.02 (Nasdaq symbol QQQQ; buy or sell through brokers; www.invescopowershares.com), formerly called Nasdaq 100 Trust Shares, holds the stocks that represent the Nasdaq 100 Index. That index is made up of the 100 largest shares on the Nasdaq exchange, based on market cap.

The Nasdaq 100 Index contains shares of companies in a number of major industries, including computer hardware and software, telecommunications, retail/wholesale trade and biotechnology. It does not contain financial companies. The fund’s expenses are about 0.20% of its assets.

The index’s highest-weighted stocks are Apple, Microsoft, Qualcomm, Google, Cisco Systems, Intel, Amazon.com, Oracle Corp., Comcast Corp. and Amgen Inc.

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Exchange traded funds (ETFs) may have a place in your portfolio. That’s because, unlike many other financial innovations, they don’t load you up with heavy management fees or tie you down with high redemption charges if you decide to get out of them. Instead, they give you a low-cost, flexible, convenient alternative to mutual funds. ETFs trade on stock exchanges, just like stocks. Prices are quoted in newspaper stock tables and online. You’ll have to pay brokerage commissions to buy and sell ETFs. However, ETFs’ low management fees still give them a cost advantage over most conventional mutual funds. As well, shares are only added or removed when the underlying index changes. As a result of this low turnover, you won’t incur the regular capital gains bills generated by the yearly distributions most conventional mutual funds pay out to unitholders....

INTEL CORP. $23 (Nasdaq symbol INTC; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 5.1 billion; Market cap: $117.3 billion; Price-to-sales ratio: 2.3; Dividend yield: 3.7%; TSINetwork Rating: Above Average; www.intel.com) warned that its revenue in the fourth quarter of 2011 will fall to $13.7 billion, down from its earlier forecast of $14.7 billion. Factories in Thailand produce half of the world’s computer hard drives, and flooding in that country has led to shortages. As a result, computer makers have cut production and are ordering fewer chips from Intel. Chip sales should rise over the next few months as hard-drive production returns to normal. As well, the shortage will not affect demand for Intel’s more-profitable server chips. Moreover, Intel gets 57% of its revenue from fast-growing markets in Asia, and just 13% from Europe....

INTEL CORP. $23 (Nasdaq symbol INTC; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 5.1 billion; Market cap: $117.3 billion; Price-to-sales ratio: 2.3; Dividend yield: 3.7%; TSINetwork Rating: Above Average; www.intel.com) warned that its revenue in the fourth quarter of 2011 will fall to $13.7 billion, down from its earlier forecast of $14.7 billion.

Factories in Thailand produce half of the world’s computer hard drives, and flooding in that country has led to shortages. As a result, computer makers have cut production and are ordering fewer chips from Intel.

Chip sales should rise over the next few months as hard-drive production returns to normal. As well, the shortage will not affect demand for Intel’s more-profitable server chips. Moreover, Intel gets 57% of its revenue from fast-growing markets in Asia, and just 13% from Europe.

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BAXTER INTERNATIONAL INC., $48.08, New York symbol BAX, is buying Synovis Life Technologies Inc. (Nasdaq symbol SYNO), which makes surgical tools and medical patches for wounds and burns. The deal will close in the first quarter of 2012. This purchase looks like a nice fit with Baxter’s existing medical products. As well, Baxter can use its distribution networks to make Synovis’s products available to more consumers, particularly in fast-growing overseas markets. The purchase price is $325 million. However, Synovis holds cash of $65 million, so Baxter is really only paying $260 million. That’s easily affordable for Baxter, which earned $624 million, or $1.09 a share, in the three months ended September 30, 2011....

INTEL CORP. $25 (Nasdaq symbol INTC; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 5.3 billion; Market cap: $132.5 billion; Price-to-sales ratio: 2.5; Dividend yield: 3.4%; TSINetwork Rating: Above Average; www.intel.com) reported record revenue of $14.2 billion in the three months ended October 1, 2011. That’s up 28.2% from $11.1 billion a year earlier. Most of these gains came from strong sales of chips for notebook computers. Revenue from these products rose 21.7% in the quarter. Sales of chips for servers rose 14.9%. Earnings rose 17.4%, to a record $3.5 billion from $3.0 billion. During the quarter, Intel bought back $4.0 billion of its shares. Because of fewer shares outstanding, earnings per share rose 25.0%, to $0.65 from $0.52. The company spent 15.0% of its revenue on research in the latest quarter, so it’s more profitable than it seems. Intel is a buy.

POWERSHARES QQQ ETF $53.53 (Nasdaq symbol QQQQ; buy or sell through brokers; www.invescopowershares.com), formerly called Nasdaq 100 Trust Shares, holds the stocks that represent the Nasdaq 100 Index. That index is made up of the 100 largest shares on the Nasdaq exchange, based on market cap. The Nasdaq 100 Index contains shares of companies in a number of major industries, including computer hardware and software, telecommunications, retail/wholesale trade and biotechnology. It does not contain financial companies. The fund’s expenses are about 0.20% of its assets. The index’s highest-weighted stocks are Apple, Microsoft, Qualcomm, Google, Cisco Systems, Intel, Amazon.com, Oracle Corp., Comcast Corp. and Amgen Inc....