Prof G Markets: Will Boeing and Intel Recover? — ft. Aswath Damodaran
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他。 的 信仰 就。

High proof fans, its eggs dropping into sharing episode of proof markets that we do not want you to miss. We are on our own separate feed now, so type in profit markets wherever you get your pot costs and hit follow to stay up today. This we come property markets.

We spoke with one of our favorite guests, professor, as well, to motoring. We talked about tech earnings, what wall street thinks of Harrison trump. And we spoke about some fAllen heroes in the stock market. He is a club.

I think the read the prom for hotel is they were at the top for so long that their story is wear the biggest, wear the best. And when that slipped, they wanted to go back to the top. And we think about what they've done over the last ten years.

It's not that they haven't tried to do the things that would make them successful. I think theyve tried too hard, tried too hard. And what sense they try to doubt. T S M C, T S M C, A, with the entire foundry, huge investments in manufacturing chips, saying we too can be like the m.

They even y've invested, I think, after in video, perhaps even more than a very, they've thrown in billions of dollars into developing the next day eye p, because they convinced that taken out in video, in videos. And I think in the process, theyve overreach. I call IT me two is among steroid because that's basically what until is done for the last five years, is me too.

I can do that, and I can do IT five times more expensively than you can. now. I remember going in the until six, six, seven years ago, I went to their offices and talking to their, you know, they ask me to come in and speak to their general audience.

And when I noticed about intel as a company was the absence of energy. You don't get that sense of excitement and energy wasn't there anymore, and it's tough to be in the business of intelligence without that driving the choices. I do think that, that it's been oversold.

I think that no, especially when they drop over twenty dollars per share, you are effectively assuming that into would drink over time and its margins would go away. Intel has a couple of advantages still that can work in its favor. One is the inflation reduction act, as you know, put as a priority, no chips made in the U.

S. T, S, M, C has built a factory in the U. S. But until is supremely well position to take advantage of the subsidies that come out of that. So if intel can find its feet on the foundry business, there's a way back.

And I think that as long as they don't try too hard and accept the fact that they will not dominate AI, that, that battles lost in video will, but they have the other business they can go after. I think there's a pathway back to middle age, not great growth, but middle for and IT listened to to any dollars per share. I I I thought I was h was is IT was a pretty good bargain as investment I own until now.

I've got to be quite, quite open about that. I did IT after I wrote the peace, and I looked at now what would happen if they became a three percent growth company in the margin slip by three or four percent, and they were two thousand eight dollars per share. With those assumptions built in, I can live with those assumptions.

I think the odds are, in fact, in your boing, there is an entirely different story. I mean, i've never seen a company blow up its reputation as thoroughly ly in his completely as boring as done over the last twenty years. I mean, one of the great engineering companies, the world, the company that was, you know, people went to because IT is is sub superb engineering and technology knowledge trusted in many dimensions.

The only reason boeing is a float is because this is not to Operate. I mean that that that's a reality is this company is so thorough, trashed its credibility in market that do any other market. We'll be talking about wrap in out by winding up the story and selling the assets to others.

I do think they are they are thinking about selling the space division now. And that's the first face in a company saying we're in trouble. We're gona sell off a crown jewels because we have to survive. There are complete survival mode and I don't know an easy pathway back to credibility because once people get the perception that you cannot be trusted, that your products are not safe, which for aircraft manufacturer is biotics dangerous, it's very difficult to find a pathway back. So boeing, I would not buy at any Price simply because I know I think there are too many things that can go wrong here that can cause the company, if not to go bankrupt, at least to be taken into receivership by somebody that might maintain the assets and run IT. But I know the company is in serious.

serious trouble. If you want to hear the rest of that episode proof markets, wherever you get out cost and hit follow, you'll get the full conversation along with they knew interview every thursday, and that's exclusively on profit markets.