Don't miss the message of Intel
This quarter points to a secular shift -- and it means there's more upside to come.
By Jim Cramer, TheStreet
Cyclical or secular? This is the question I always used to put to my team on any stock that just beat numbers so big that I have to ask if there is something larger than just a bump in sales that made things better.
And on Intel (INTC), I say "secular," meaning new product cycle that is unique to Intel. The reason so many analysts were lukewarm or negative on Intel was that all of the ordering was perceived to be restocking. That the inventories had gotten so low that there was simply a dearth of supply, not that demand had gotten more aggressive or that they had something new and compelling that could last.
I think last night showed that this second wave is demand-driven not supply-driven -- personal computers are taking off and communications and server chips are starting to make a real difference, such a difference that we could see gross margins exceed old extreme levels of 63%-64%.
So when you go to short it, which is what I figure people will do here, remember that it is easy to short a cyclical but very hard to short something long-lived and demand-driven. Just keep in mind and temper the (knee-jerk) negativity.
At the time of publication, Cramer was long Intel.
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