There are no safe havens in the stock market. Every stock carries risk. But some less than others. This column features stocks that have shown one or more of the following characteristics: less volatility, better earnings, larger market caps, safe and increasing dividends. In these times of turmoil, our goal is to show readers better opportunities for investing with fewer risks.

January 13, 2009 - Intel Corporation (INTC-NASDAQ) engages in making, marketing, and selling integrated circuits for computing and communications industries worldwide. It offers microprocessor products, including multi-core processors, quad-core microprocessors, 32-bit architecture microprocessors, and 64-bit architecture microprocessors used in mobile and desktop computers, enterprise computer servers, and workstations, as well as in embedded designs, such as industrial equipment, point-of-sale systems, panel PCs, automotive information/entertainment systems, and medical equipment.

Intel's customers include original equipment manufacturers, original design manufacturers, PC and network communications products users, and other manufacturers of industrial and communications equipment. The company was founded in 1968 and is based in Santa Clara,California.

With the stock at levels not seen in over a decade, it also has something else: a decent dividend. The yield is 4% with an annual payout of 55 cents that takes about 50% of earnings. This used to be a growth stock that carried a P/E close to 50. Now it's a mature company with a respectable yield and worth a conservative investor's consideration.

Debt is only 5% of capital. The company has an A++ financial strength rating from Value Line. There's more than $12 billion in cash. Earnings are expected to grow by an annual average of 12.33% for the next 5 years (though not in a straight line). It's also the industry leader in semiconductors.

Earnings have been erratic over the last few years, and predicted to be in the future. That's because the semiconductor business is very cyclical in nature. It rides the economic cycle and reflects a growing or shrinking economy as well or better than most stocks. As you know, right now the economy is shrinking. Times are tough. Spending on computers is down. That makes demand for semiconductors weaken.

Even with the slowdown, earnings for this year are expected to be $.94 a share, well below last year's $1.18. Fourth quarter 2008 eps (earnings per share) are expected at 5 cents, way down from 38 cents in the fourth quarter of 2007. Earnings will be announced on January 15. Next year, analysts see 70 cents a share for the full year, but those numbers will most likely be revised several times as the economy gets worse or better (yes, it will eventually get better).

Sales are slowing. In 2007, they were $38.33 billion. For 2008, analysts expect the final tally to be $37.66 billion. Next year, they see a drop to $31.70 billion. 85% of revenues come from international sales. While the U.S. economy is bad, many other countries are worse. Don't look for a jump in sales until the global economy is on the mend, not just the U.S.

There is currently a glut of inventory. In the past, when product piles up, it takes about 2 to 3 quarters to clear out. With the world economy so weak, it may take a full year in this cycle.

Investors with a longer time horizon, however, can expect some very positive results. By the end of 2009, the company will have a new 32 nanometer manufacturing process, creating better efficiencies. Management believes it can implement a new cutting-edge production method about every 12 months. If so, it will continue to hold and increase its industry leadership.

More numbers: P/E is 11. Forward P/E is 20. Price to sales is 1.96. Price to Book is 2. Operating margin for the last 12 months was 27.84% and Profit margin was 18.29%. Return on Equity was 18.4%. There's $2.20 in cash per share. Total debt is $2.36 billion. Debt to Equity is .06. Current ratio is 2.13. Book Value is $7 a share. There are 5.56 billion shares outstanding.

Consider Intel if you're looking for a conservative stock. While the industry it serves is volatile and cyclical, it has established itself as the leader, and the stock will reflect that role when the global economy revives. While electronic gadgets and personal computers won't sell as strongly for a while, businesses are always looking to be more efficient, and technology is the key to efficiency. There is still a good market for what Intel makes. It's just not very robust at the moment.

Company Web site: www.intc.com

- Ted Allrich