Lackluster Back-to-School PC Demand Doesn't Bode Well for Intel (INTC)

Intel (Nasdaq: INTC) shares are on watch Monday following reports that back-to-school sales might not have been as robust as expected.

Sterne Agee's Vijay Rakesh said build rates have been flat with the same period last year, meaning PC demand is nonexistent.

Intel's mobile chips and server chips aren't expected to kick too much more in. Also going against Intel is the Microsoft (Nasdaq: MSFT), Nokia (NYSE: NOK), which could weaken Intel's handset chip market share.

Even if Intel does gain traction in mobile, Rakesh noted that the company's notebook chips sell for about $150 and see a 10 percent drop in price year over year, while mobile chips are priced from 20 percent to 40 percent and see a 10 percent drop in price each quarter.

Intel is up 0.2 percent Monday.

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