Canaccord Genuity Morning Coffee on Intel (INTC): An Intelligent Buy?
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Rating Summary:
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Today's Overall Ratings:
Up: 10 | Down: 23 | New: 20
Rating Summary:
23 Buy, 25 Hold, 6 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 10 | Down: 23 | New: 20
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Canaccord Genuity Morning Coffee on Intel (Nasdaq: INTC): An Intelligent Buy?
Intel has announced an agreement to spend $4.1 billion to fund Dutch company, ASML (Nasdaq: ASML), in research programs and buy an initial 10% stake. It is hoped that the investments will bring forward the development of advanced chipmaking technology by around two years. ASML manufactures lithography systems, the circuitry etched onto silicon wafers, and together the two companies will jointly develop smaller and more advanced chip-making technology. As chip-making technology has progressed, investments in further improving the focus of beams has become increasingly difficult, and now requires sums of money so great no one company can risk taking them alone—and no chipmaker could afford to miss out on a serious advance in technology. Under the terms of the deal, Intel will buy an initial 10% of ASML’s shares for about $2.1 billion at $49.08 per share. The American technology giant also agreed to pay about $1 billion to help finance additional research and development costs at ASML. The investment will be used primarily to speed up the introduction of bigger chip wafers and newer semiconductor manufacturing technology known as extreme ultraviolet lithography. If approved by ASML shareholders, Intel would later buy an additional 5% for $1 billion. ASML had previously said that it planned to sell up to 25% of itself to chip makers like Intel as a way to raise capital. Intel said that it plans to pay for the investment through cash held in foreign subsidiaries, which it can use without incurring taxes in the U.S. Analysts said the deal would help cement ASML's market leading position, save money, safeguard its technology lead, and make it harder for smaller competitors to keep going. For Intel, the stake will also help cut time off chip production using new manufacturing methods and create state-of-the-art factories and production techniques that help set it apart from other chipmakers.
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Intel has announced an agreement to spend $4.1 billion to fund Dutch company, ASML (Nasdaq: ASML), in research programs and buy an initial 10% stake. It is hoped that the investments will bring forward the development of advanced chipmaking technology by around two years. ASML manufactures lithography systems, the circuitry etched onto silicon wafers, and together the two companies will jointly develop smaller and more advanced chip-making technology. As chip-making technology has progressed, investments in further improving the focus of beams has become increasingly difficult, and now requires sums of money so great no one company can risk taking them alone—and no chipmaker could afford to miss out on a serious advance in technology. Under the terms of the deal, Intel will buy an initial 10% of ASML’s shares for about $2.1 billion at $49.08 per share. The American technology giant also agreed to pay about $1 billion to help finance additional research and development costs at ASML. The investment will be used primarily to speed up the introduction of bigger chip wafers and newer semiconductor manufacturing technology known as extreme ultraviolet lithography. If approved by ASML shareholders, Intel would later buy an additional 5% for $1 billion. ASML had previously said that it planned to sell up to 25% of itself to chip makers like Intel as a way to raise capital. Intel said that it plans to pay for the investment through cash held in foreign subsidiaries, which it can use without incurring taxes in the U.S. Analysts said the deal would help cement ASML's market leading position, save money, safeguard its technology lead, and make it harder for smaller competitors to keep going. For Intel, the stake will also help cut time off chip production using new manufacturing methods and create state-of-the-art factories and production techniques that help set it apart from other chipmakers.
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