Another weakness for the company is its late entry in the smartphone and tablet markets. While Intel only has a handful of devices in the industry, QUALCOMM, Inc. (NASDAQ:QCOM) and NVIDIA Corporation (NASDAQ:NVDA) are already enjoying their success. The company won’t be able to cause major problems to its competitors and getting a decent market share in this particular industry will require several years.
Opportunities
Intel definitely has numerous opportunities with different types of markets to target including the current PC market, the market for tablets/smartphones and the market for Windows 8 hybrids.
The smartphones and tablets market is huge for Intel and is possibly the company’s future. Intel’s current position in the industry is relatively weak, but the company is already partnering with some of the leading names in order to use its chips in Android-based smartphones and tablets.
The Windows 8 hybrids are still at their early stage, which is why they haven’t been that successful. However, Intel believes that these will definitely pick up pace in the near future as Intel already has contracts with Dell Inc. (NASDAQ:DELL), Helmerich & Payne, Inc. (NYSE:HP) and Lenovo Group Limited (ADR) (OTCMKTS:LNVGY).
Threats
Intel’s biggest competitors are QUALCOMM and NVIDIA, having been around in the smartphone and tablet industry for quite some time now. Both companies have been involved with some of the most successful smartphones and tablets. Even if Intel can step up its game in this particular industry, the company will only be able to capture around 10% to 15% of the market by 2017.
Things to be optimistic about
Firstly, Intel’s entry into smartphones and tablets is crucial for the company’s future success. After partnering with Lenovo Group Limited (ADR) (OTCMKTS:LNVGY) for an Intel-based smartphone, the company has now partnered with Samsung Electronics Co., Ltd. (KRX:005930) for its upcoming tablet. Not only will this help Intel get a good market share, but will also help the company in future partnerships with leading manufacturers.
Windows 8 is also something to be optimistic about and even though it hasn’t done too well, it has great potential. Even if the Windows 8 ultrabooks don’t get successful, the hybrids and convertibles will definitely pick up pace, soon.
Aside from that, the company also has plans to enter and improve in newer emerging markets including China and Thailand.
Conclusion
Even though Intel showed a profit and revenue decline in its last earnings report, I’m still bullish on Intel and I believe that the company can hit as high as $50 very soon. Yes, it will take some time before Intel can get a strong hold of the market for tablets and smartphones; however, with deals like the one with Samsung Electronics Co., Ltd. (KRX:005930), I think that the company will be able to get a good chunk of the market in less than four years. QUALCOMM and NVIDIA, on the other hand, will definitely face some problems with Intel looking to become the third dominant force in the industry.
Yasir Idrees has no position in any stocks mentioned. The Motley Fool recommends Intel and NVIDIA. The Motley Fool owns shares of Intel and Qualcomm. Yasir is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
The article Why I’m Bullish on Intel originally appeared on Fool.com is written by Yasir Idrees.
Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.
