Sun Microsystems (SUNW) picked Intel (INTC) to supply chips for its servers after years of an exclusive relationship with Intel rival AMD (AMD). Intel is even going to use its engineers to make Sun’s software more appealing to customers.
The story was one of the most prominent pieces of news in the business media yesterday. but someone forgot to tell investors it was important. Sun’s stock dropped slightly. Intel’s stock was flat. And, AMD was up a little for the day. They were the big loser in the deal.
What happened?
For starters, no one knows what the deal is worth. Wall St. tends to discount announcement without any dollars attached.
Next, what did Intel give up on pricing to get the deal?
And, Sun has been considered an "also ran" in the server market, even with recent gains, it has a small portion of the global market . It’s stock has had a nice run, but recently analysts have become concerned that it won’t live up to expectations.
Anyway, nice announcement. But, no one cared.
Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.
Top Gaining Stocks
Top Losing Stocks