STOCKREPORTS		 Intel Corporation Nasdaq Symbol INTC
In S&P 500
19-JUL-97 Industry:
Electronics (Semiconductors)		 Summary: Intel is the world's largest manufacturer of microprocessors, the central processing unit of a PC. Various other products that enhance a PC's capabilities are also produced.

Recent Price 86.44
52 Wk Range 86.44 - 37.13		 Yield 0.1%
12-Mo. P/E 22.6

Quantitative Evaluation:
Outlook (1 Lowest - 5 Highest)
4
Fair Value
182.00
Risk
MEDIUM
Earn/Div Rank
B+
Technical Evaluation:
BULLISH since 05/97
Rel. Strength Rank (1 Lowest - 99 Highest)
85
Insider Activity
Neutral

Overview 19-MAY-97

We see revenues growing 30% in 1997, on strong worldwide demand for personal computers (PCs), and continued industrywide embrace of INTC's Pentium and Pentium Pro microprocessor families, which have minimal competition (see below), and Intel's MMX multimedia technology. We expect demand for the high-end Pentium Pro to grow, fueled by price reductions on the chip as Intel rolls out its new Pentium II targeted at high-end desktops in May. We also see further growth for the Pentium with MMX technology, as it continues to find strong acceptance from consumers looking for improved graphics performance. Margins should be in the 60% range, as a better mix of processors is offset somewhat by less profitable board level products, reflecting Intel's ramp of its new Pentium processors. R&D and marketing costs will grow sharply, as Intel seeks to maintain its dominant position in the industry.

Valuation 19-MAY-97

The shares have retreated into a trading range after soaring in late 1996 on Intel's surging revenue and EPS performance in 1996's second half, and on prospects for a strong upgrade cycle in 1997. The shares have stalled since January, however, primarily due to exaggerated concerns over competition from Advanced Micro Devices and Cyrix. Most industry experts agree that Intel's dominance in the industry will continue. We see Intel as the principal benefactor of the current upgrade cycle, which should gain momentum given: aggressive pricing by OEM manufacturers; Intel's own strong pricing strategy as it transitions to its Pentium II desktop microprocessors; and the popularity of Windows NT. We recently raised our 1997 estimate to $9.00 from $7.45, on the strength of Intel's first quarter earnings report. We believe Intel's current valuation offers investors above average appreciation potential.

Key Stock Statistics

S&P EPS Est. 1997 4.12
P/E on S&P Est. 1997 21.0
S&P EPS Est. 1998 5.25
Dividend Rate/Share 0.12
Shs. outstg. (M) 1638.0
Avg. daily vol. (M) 22.984
Tang. Bk. Value/Share 10.45
Beta 1.31
Shareholders 124,000
Market cap. (B) $141.6
Inst. holdings 54%
Value of $10,000 invested 5 years ago:$ 142,917

Fiscal Year Ending Dec. 31

Revenue (Million $)
1997 1996 1995 1994 1993 1992
Q1 6,448 4,644 3,557 2,660 2,024 1,241
Q2 5,960 4,621 3,894 2,770 2,130 1,320
Q3 NA 5,142 4,171 2,863 2,240 1,426
Q4 NA 6,440 4,580 3,228 2,389 1,856
Year NA 20,847 16,202 11,521 8,782 5,844

Earning Per Share ($)
1997 1996 1995 1994 1993 1992
Q1 1.10 0.51 0.51 0.35 0.31 0.11
Q2 0.92 0.59 0.50 0.36 0.32 0.13
Q3 E0.90 0.74 0.52 0.38 0.33 0.14
Q4 E1.20 1.07 0.49 0.22 0.34 0.25
Year E4.12 2.90 2.02 1.31 1.30 0.62

Dividend Data (Dividends have been paid since 1992)
Amount ($) Date Decl. Ex-Div. Date Stock of Record Payment Date
0.050 Nov. 13 Jan. 29 Feb. 01 Mar. 01 '97
0.050 Mar. 26 Apr. 29 May. 01 Jun. 01 '97
2-for-1 Jan. 14 Jul. 14 Jun. 16 Jul. 13 '97
0.030 May. 21 Jul. 30 Aug. 01 Sep. 01 '97

Business Summary 19-MAY-97

With an overwhelming market share of some 95% in 1996, as measured by Dataquest Inc., Intel is by far the leader in sales of X86 microprocessors for PCs (personal computers).

INTC's product strategy is twofold: the company offers OEMs (original equipment manufacturers) a wide range of PC building-block products to meet their needs, and offers PC users products that expand the capability of their systems and networks.

Intel introduced the first microprocessor in 1971. A microprocessor is essentially the "brains" (the central processing unit) of a PC, processing system data and controlling the other devices in the system. INTC's fifth generation Pentium line was the most popular processor in 1995, eclipsing the 486 family in unit volume in the third quarter. Intel introduced its sixth-generation microprocessor in November 1995, the Pentium Pro. This high-end chip is mostly targeted for use in workstations, high-end desktop systems and servers.

In May 1997, Intel will launch its latest technology, the Pentium II processor. Pentium II will use a Dual Independent Bus (DIB) architecture targeted at addressing bandwidth constraints limiting the output and performance of processors. Initially, Pentium II should offer clock speeds of 400 MHz, or double the processing speed of the fastest Pentiums currently in use. By the year 2000, the combination of the DIB architecture, the Pentium II processor systems, and a new feature called an Accelerator Graphics Port, is expected to enable the bandwidth to scale with the processor to reach clock speeds of 500 MHz. Pentium II will incorporate Intel's MMX media enhancement technology, as will all of Intel's chips by early 1998.

Intel also produces chipsets, which support and extend the graphic and other capabilities of microprocessors; embedded chips, which provide devices like wireless communications devices, printers, copiers, fax machines with computing power; and flash memory chips used to store computer data.

INTC is offering an increasing number of networking products. These include its EtherExpress family of adapters and LANDesk line of network management products. ProShare personal conferencing products let two users view and manipulate the same documents simultaneously and, in some cases, see real-time video images of each other.

Manufacturing and test facilities are located in Chandler, AZ; Aloha and Hillsboro, OR; Santa Clara and Folsom, CA; Rio Rancho, NM; Las Piedras, Puerto Rico; Jerusalem, Israel; Leixlip, Ireland; Penang, Malaysia; and Manila, Philippines. In 1996, foreign business contributed 58% of sales and 36% of operating income.

Capitalization

Long Term Debt: $481,000,000 (3/97).

Per Share Data ($)
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
Tangible Bk. Val. 10.27 7.40 5.61 4.48 3.25 2.71 2.25 1.73 1.44 0.97
Cash Flow 3.97 2.79 1.90 1.71 0.92 0.74 0.58 0.42 0.46 0.24
Earnings 2.91 2.02 1.31 1.30 0.62 0.49 0.40 0.26 0.32 0.12
Dividends 0.09 0.07 0.06 0.09 0.01 Nil Nil Nil Nil Nil
Payout Ratio 3% 3% 4% 7% 2% Nil Nil Nil Nil Nil
Prices - High 70 3/4 39 1/4 18 3/8 18 5/8 11 1/2 7 3/8 6 1/2 4 1/2 4 5/8 5 1/4
- Low 24 7/8 15 3/4 14 10 3/4 5 7/8 4 3/4 3 1/2 2 7/8 2 7/16 1 3/4
P/E Ratio - High 24 19 14 14 18 15 16 17 15 43
- Low 9 8 11 8 9 10 9 11 8 14

Income Statement Analysis (Million $)
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
Revs. 20,847 16,202 11,521 8,782 5,844 4,779 3,921 3,127 2,875 1,907
Oper. Inc. 9,441 6,623 4,863 4,109 2,043 1,498 1,151 794 805 417
Depr. 1,888 1,371 1,028 717 518 418 292 237 211 171
Int. Exp. 58.0 75.0 84.0 58.0 66.0 88.0 102 102 78.0 63.0
Pretax Inc. 7,934 5,638 3,603 3,530 1,569 1,195 986 583 629 288
Eff. Tax Rate 35% 37% 37% 35% 32% 32% 34% 33% 28% 39%
Net Inc. 5,157 3,566 2,288 2,295 1,067 819 650 391 453 176

Balance Sheet & Other Fin. Data (Million $)
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
Cash 7,907 2,458 2,410 3,136 2,835 2,277 1,785 1,090 971 619
Curr. Assets 13,684 8,097 6,167 5,802 4,691 3,604 3,119 2,163 1,970 1,431
Total Assets 23,765 17,504 13,816 11,344 8,089 6,292 5,376 3,994 3,550 2,597
Curr. Liab. 4,863 3,619 3,024 2,433 1,842 1,228 1,314 921 934 882
LT Debt 728 400 392 426 2.5 363 345 412 479 298
Common Eqty. 1,687 12,140 9,267 7,500 5,445 4,418 3,592 2,549 2,080 1,306
Total Cap. 18,597 13,160 10,048 8,223 5,874 4,924 4,063 3,073 2,616 1,715
Cap. Exp. 3,024 3,550 2,441 1,933 1,228 948 680 422 477 302
Cash Flow 7,045 4,937 3,316 3,012 1,584 1,237 943 628 664 347

Curr. Ratio 2.8 2.2 2.0 2.4 2.5 2.9 2.4 2.3 2.1 1.6
% LT Debt of Cap. 3.9 3.0 3.9 5.2 4.2 7.4 8.5 13.4 18.3 17.4
% Net Inc.of Revs. 24.7 22.0 19.9 26.1 18.3 17.1 16.6 12.5 15.8 9.2
% Ret. on Assets 25.0 22.8 18.3 23.6 14.7 13.9 13.4 10.3 14.3 7.5
% Ret. on Equity 35.6 33.3 27.4 35.5 35.5 20.2 20.5 16.7 26.0 13.6

Data as orig. reptd.; bef. results of disc. opers. and/or spec. items. Per share data adj. for stk. divs. as of ex-div. date. E-Estimated. NA-Not Available. NM-Not Meaningful. NR-Not Ranked.

Office--2200 Mission College Blvd., Santa Clara, CA 95052-8119. Tel--(408) 765-8080. Chrmn emeritus--G. E. Moore. Chrmn & CEO--A. S. Grove. Pres--C. R. Barrett. Investor Contact--Gordon Casey. VP & CFO--A. D. Bryant, VP & Secy--F. T. Dunlap, Jr. Dirs--C. R. Barrett, J.P. Browne, W. H. Chen, A. S. Grove, D. J. Guzy, R. Hodgson, S. Kaplan, G. E. Moore, M. Palevsky, A. Rock, J. E. Shaw, L. L. Vadasz, D. B. Yoffie, C. E. Young. Transfer Agent & Registrar--Harris Trust and Savings Bank. Incorporated--in California in 1968. Empl-- 48,500. S&P Analyst: Megan Graham Hackett


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