Intel Earnings To Dictate Trend of Tech Stocks (INTC, AMD)

After today’s closing bell, we’ll see earnings for Q1-2008 from Intel Corp. (NASDAQ: INTC).  The processor and chip giant estimates from First Call are $0.25 EPS on $9.63 Billion in revenues. 

We’ve already been warned by Intel that Flash Memory was taking down the quarter and it would probably be a shock if the estimates ahead from the company were put conservatively.  Over the last 3-months, analysts have taken down numbers across the board for Q1, Q2, Q3, 2008 and even 2009.

Next quarter estimates are $0.28 EPS on $9.23 Billion in revenues, and Fiscal-2008 estimates are $1.29 EPS on just over $39.7 Billion in revenues.

Options traders appear to be braced for a move of up to $0.69 to $0.76 on on a static basis as of noon.  Analysts have a price target of just over $26.00 on the chip giant.  Intel has already hiked its dividend.

Intel has traded under its 200-day moving average since the start of 2008, and that level on last look was $23.75.  But it has been using the 50-day moving average as a pivot level, and that was listed as $20.86 on last look.  With shares up less than 0.5% at $20.78 currently, that 50-day moving average may be a critical juncture ahead.

While this report will likely translate directly into major revisions for Advanced Micro Devices (NYSE: AMD), we have a fresh warning and layoffs already announced from AMD ahead of its earnings in just two day; AMD also saw its CTO leave the company.  Intel earnings and guidance may set the trend for companies up and down the entire PC and tech infrastructure line from PC’s to software to peripherals to chips to storage to internals.

Jon C. Ogg
April 15, 2008

Jon Ogg produces the Special Situation Investing Newsletter.  He can be reached at [email protected] and he does not own securities in the companies he covers.