Amgen vs. Intel: Intel

In the competitive spirit of college basketball's annual championship tournament, The Motley Fool brings you Stock Madness 2007! Our writers are making head-to-head arguments for their chosen stocks (but not necessarily investment recommendations -- this is, after all, a game), and you'll pick the winners with your article recommendations and Motley Fool CAPS ratings. Who will win the right to cut down the net? Let's tip things off and find out!

You know the teams -- Duke, Kentucky, North Carolina, UCLA, Michigan State -- and regardless of whether you love 'em or hate 'em, you know they are going to be part of the Big Dance every year.

Their success cannot be attributed to a single factor. Usually, it is a combination of things, including excellent coaching, solid recruiting, and playing in a competitive conference.

Successful companies are no different, and one of the most winning companies over the past three decades has been Intel (Nasdaq: INTC  ) . Oh, sure, its stock hasn't moved much since 2002 -- but like the best college hoops programs, it's hard to keep the really good companies down for long.

It would be easy to accuse Intel of resting on the legacy of its co-founder Gordon Moore, whose famous prediction about the number of transistors doubling every 18 months was central to it success. But that would be like saying that UCLA is resting on John Wooden's good name.

Just as the Bruins have forged ahead in recent years and crafted a new identity, so, too, has Intel. This past season proves it -- the company began the preseason by showing up in excellent shape. Recall that it shaved its workforce by a full 10% starting in August.

Intel got off to a quick start in November and jumped ahead of the then-resurgent Advanced Micro Devices (NYSE: AMD  ) by unveiling the first quad-core chip months ahead of its arch-rival.

The company kept the momentum going by scoring an upset victory when it claimed Sun Microsystems as a client. In December, it added another impressive win when it landed top-ranked Google (Nasdaq: GOOG  ) as a customer.

As its willingness to go toe-to-toe with AMD in a fierce price-cutting war this past season has demonstrated, Intel is now a lean, mean, fighting machine whose skills have been battled-tested by having to regularly compete against the likes of AMD, IBM (NYSE: IBM  ) and Hewlett-Packard (NYSE: HPQ  ) .

There's no doubt about it, this is a company that is ready to make a serious run for the title.

With more than $10 billion in cash and a debt of only $2 billion, it has not only a deep bench but, thanks to an annual R&D budget of $6 billion, a talented bench as well.

The company also has some young exciting underclassmen that are ready to contribute. This past July, it recruited an up-and-coming wireless player, Clearwire, in a $600 million acquisition. Its partnership with Nanosys, a small point guard-like company with expertise in nanotechnology, could help it slice into some exciting new markets.

Regardless of the competitor, Intel has an answer. Its partnership with Motorola (NYSE: MOT  ) and Sprint (NYSE: S  ) in the field of Wi-Max will make it a player in the telecommunications bracket, and its relatively new Digital Health Group will help Intel compete against even the best health-care companies.

They say that good defense wins championships, and the Digital Health Group can assist the company in reaching that goal by helping its customers prevent disease before it occurs (unlike pharmaceutical firms, which profit by treating disease after it occurs). But I like Intel just as much for its superior conditioning, competitive nature, and deep and talented bench. To my mind, that combination of factors suggests that the company is poised to return to its glory days.

If you love Intel as much as you do your top NCAA hoops pick and think it deserves to move onto the next round, simply follow this link and rank the stock "outperform" in Motley Fool CAPS. If not, vote it "underperform." Later this week, we'll tally your votes to determine which stocks will advance one step closer to the title match.

Click here to read the opposing entry in this contest.

And follow this link for all of the tourney entries.

Do you think you could pitch your favorite stock or ditch your least favorite one in less than 27 seconds? That's what we're doing over at Motley Fool CAPS. Check out our new stock videos.

For the record, Fool contributor Jack Uldrich is not a fan of Duke, North Carolina, Kentucky, UCLA or Michigan State. He prefers the smaller schools and is betting that Creighton is this year's Cinderella Story. He owns stock in Intel, which is an Inside Value pick. The Fool has a strict disclosure policy.


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