With Stronger Push into Smart TVs & Mobile, Will FY13 be Intel's (INTC) Year?

December 28, 2012 7:38 AM EST Send to a Friend
In China, 2013 will be the Year of the Snake. However, as things are shaping up right now, 2013 might end up being the Year of the Intel (Nasdaq: INTC).

Earlier this week, it was reported that Intel would be unveiling a new mobile operating system next February. Not many details were disclosed, but Intel moving into the mobile sphere is certainly a big step and will diversify Intel's revenue stream.

Today, Digitimes is out with more expectations. The firm sees Intel in accords with Hewlett-Packard (NYSE: HPQ), Compal Electronics, and Quanta Computer to launch a full-on smart TV next year. According to the news, the TV will not simply have PC functionality, but will focus on user interface (UI), and adopt such functions as voice, facial, and gesture recognition systems.

In the past, Intel has worked with Microsoft (Nasdaq; MSFT) in promoting the Windows Media Center Edition (MCE) operating system. Intel has also been releasing low-power processors to help power IPTV set-top-boxes (STBs) and other interactive TVs.

Intel has also been working hard on making efficient chips for mobile devices and it's latest "Ivy Bridge" chip will be used to power Microsoft Windows Pro-based tablets next year.

Shares of the tech giant fell over 12 percent in 2012, are currently 28.6 percent below annual highs and 6.7 percent above the low. The stock is going for about 9 times current earnings and 10.6 times next year's expectations, which are about 8 percent lower. Those willing to wait on Intel will still be compensated; the company currently shells out 90 cents per year in dividends with a yield of about 4.4 percent.

Risks include slumping PC demand, light Windows Pro tablet sales, continued macro pressure, and the possibility that Apple (Nasdaq: AAPL) will drop its chips within the next year.

If you think Intel is going to have a decent 2013, make headway into mobile devices, and not mimic recent actions of peer Advanced Micro (NYSE: AMD), then it might be time to take a second look at the venerable chip maker. Shares are flat Friday morning.


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