Looking to Get Bullish on Intel? Look at Its Data Center Business

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intel headquarters in mission college blvd of santa clara

intel headquarters in mission college blvd of santa claraIntel’s stock has been the unwanted stepchild of the tech stock sector recently. If you wanted to make a lot of money in tech, Intel (NASDAQ:INTC) is not the stock to get into. In fact, you can get into smaller companies that just blow up overnight in value instead of wasting your time invested in Intel’s shares that seem to go nowhere but sideways or slightly down. Intel has delivered more than its fair share of headaches over the past few quarters, but the good news is if you look closely at its numbers, it appears that the company is doing quite well in its transition to a post-PC world.

Let me lay it on the table: The PC world composed of IBM PC clones driven by Windows operating systems and Intel central processing units is a thing of the past. The future is all about mobile technology. We are of course talking about larger smartphones and tablets that perform the work of traditional notebook computers but with none of the hassles. It is no surprise to know then that a lot of the technology world from IBM to Microsoft are eagerly embracing cloud computing. This is not just a buzz word. This is the future.

With that said, any kind of transition will always be messy and fraught with uncertainty. A lot of the downward pressure on Intel’s shares recently has been due to the fact that the company is going through an identity crisis. It’s trying to get rid of its PC past and focus on its data center strategy.

This is a very powerful direction for Intel because it has a tremendous marketing advantage. The data center market is a business-to-business market. This means higher prices, larger volumes, and recurring demand. Compare this with consumer sales where consumers can only be relied on to buy a new computer every three to four years. There is no comparison.

This is why if you are looking to get into tech and have a long timeline and are quite patient, you might want to consider Intel. It’s doing a great job with its data center group. This group is now responsible for over 50% of Intel’s profits. Expect this figure to get bigger and bigger as Intel completes its transition to more of a cloud-based, big data, and data center processing company.

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