Intel Corporation (INTC): What Is Haswell?

This PC name isn’t so happy

One of the biggest improvements that Haswell brings with it is its GPU. Intel says that Haswell can deliver up to twice the graphics performance as compared to its predecessor. Technology website Anandtech says that this is the first time that Intel’s built in GPU can be directly compared with those made by dedicated GPU maker NVIDIA Corporation (NASDAQ:NVDA). In fact, Intel’s top end configuration for Haswell will be able to directly compete with NVIDIA’s GeForce GT 650M.

This is a big negative for the graphics chip maker because it reduces, and to some extent eliminates, the need for separate graphics cards to enable high performance gaming and video playback on PCs. Although NVIDIA has reduced its exposure to the PC gaming market with its Tegra System On Chip (SOC) processors for mobile, I can see NVIDIA Corporation (NASDAQ:NVDA) taking a hit on its GeForce sales as Intel Corporation (NASDAQ:INTC), with Haswell, increasingly becomes a direct competitor to NVIDIA Corporation (NASDAQ:NVDA)’s graphics cards business.

Foolish take

The time to buy Intel is now. The sentiment around PCs is at an all-time low and many investors are underestimating the impact that Haswell can have on Intel’s prospects and on the PC industry as a whole. In the Q1 earnings report, Intel Corporation (NASDAQ:INTC) reported a gross margin of 56%, but for the full year, Intel maintained its gross margin outlook of 60%, which means that management expects a lot more upside in the second half of the year.

Intel Corporation (NASDAQ:INTC) currently trades at a forward 2014 P/E multiple of just 11.9 times. Going by historical P/E ratios, Intel’s price-to-earnings multiple can easily expand to 12.5 times. With an expanding valuation multiple and rising earnings estimates thanks to Haswell, Intel can deliver strong returns in the coming months and years.

The article This Tech Giant Has an Amazing New Product originally appeared on Fool.com and is written by Zain Zafar.

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