It was sad when that great ship went down...

Posted by: Aaron Pressman on February 22, 2006

My children and I were treated to a stirring rendition of that old song about the sinking of the Titanic on President’s Day during a visit to Boston’s most excellent Museum of Science. I was reminded of the ditty just now when I saw a headline that Intel (INTC), once half of the great and powerful “Wintel” monopoly, was about to break through $20 a share — the bad way — on the way down. Despite BW’s rosy outlook in our issue dated January 9, investors seem to think the great unsinkable ship that Andy Grove built has hit a pretty serious iceberg. It’s down almost 20% for the year.

Shares of Intel haven’t been below $20 since 2004 when that psychologically appealing level proved to be a bottom and the stock subsequently almost hit $30 before encountering turbulence again later in 2005. Interestingly, even though it feels like sentiment has turned against Intel, the stat trackers over at Bernie Schaeffer’s shop note that short interest in the stock is pretty minimal, many analysts still like it, and options volume isn’t signaling much pessimism. Schaeffer, in a comment last month, wrote that Wall Street’s upbeat attitude towards Intel while it remained luke warm on zooming competitor AMD (AMD) showed “when given a chance, even between two formidable companies, (the street) will almost always prefer the stumbling, bumbling giant.”

Like when the great ship went down, those following the consensus advice to overweight mega-caps in 2006 may be feeling some pain here. “Husbands and wives, little children lost their lives. It was sad when that great ship went down.”

ps How fast will Toll Brothers (TOL) prove me wrong this time? After my entry yesterday to avoid the lux homebuilder, the stock is up 5% today.

Reader Comments

JIM FITCHETT

October 10, 2007 5:58 PM

I WOULD LOVE TO FIND A CD OR RECORDING OF THAT OLD SOND. I HAVE BEEN RESEARCHING A SOURCE, BUT HAVE NOTHING TO DATE, A SOURCE WOULD BE APPRECIATED. THANKS, JIM FITCHETT, jfitchett@bellsouth.net

John Boland

October 16, 2007 9:52 AM

Jim -- are you referring to "The Great Titanic"? I used to sing it in my younger days, and can still do so.

"First verse:
Oh they built the ship Titanic and they thought when they were through,

that they had a ship that the water would ne'er go through.

But the Lord's almighty hand said the ship would never land,

it was sad when the great ship went down.

John B
509-582-7608

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Bloomberg Businessweek’s Ben Steverman focuses on the latest moves in financial markets and emerging trends in stocks, bonds, and funds, always with an eye toward giving readers a better understanding of the sometimes confusing and often chaotic world of money. Standard & Poor’s senior index analyst Howard Silverblatt will also provide his take on companies’ finances and the markets. Voted one of the “Top 100 Finance Blogs” in 2007.

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