Alpine Capital Research is a value-oriented portfolio manager currently sitting on 40% cash because, as portfolio manager Willem Schilpzand puts it: “Our cash is a reflection of a lack of opportunities.” However, Alpine is currently putting money to work in Intel Corporation stock. In a recent interview with The Wall Street Transcript, Schilpzand explains that “…the belief was or perhaps still is that Intel can only make performance-heavy chips while mobile products require power-efficient chips, and that therefore Intel’s mobile ventures would fail. This negative sentiment sounded like a potential opportunity to us.”
FOR MORE INFORMATION ABOUT THIS INTERVIEW CLICK HERE.
The massive dominance that Intel has in the personal computer and data center server markets has actually seemed to penalize the company, as the lack of the same 85+% market shares are not duplicated in the fast-growing mobile computer space which dominates current investor focus. As red-hot tablet and mobile phone device growth rates begin to slow, and new Intel products get rolled out to those form factors, perhaps investors will also begin to realize the massive opportunity in the security space.
Mr. Schilpzand believes that “Intel has an opportunity here to build antivirus or other protection onto the chips they sell and provide better security without the software slowdown issues” that occur with security-conscious computer users. He further suggests that the prudent investor consider that “Intel is the only company that has a tablet chip out that is compatible with both Microsoft’s (MSFT) and Google’s (GOOG) mobile operating systems…So if you are an original equipment manufacturer who sells both Windows and Android tablets, you can now go to Intel to buy one chip and…streamline the purchase process for the chips.” Given all these positives, the recent selloff in Intel may be an opportunity to add to a value-oriented stock portfolio.
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