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Can These Three Stocks Recover in 2013?

Plus, there continue to be rumblings that Apple might adopt Intel in its devices. Although Intel has yet to confirm these rumors, as with Microsoft, things can't get much worse with expectations already so low.

In the meantime, the company has given investors reasons to remain patient by announcing a pretty significant share buyback. The last time Intel bought back shares, the stock surged more than 40% in two quarters. At $21 per share, the stock deserves a long look and offers 20% premium potential on the basis of the share buyback.

Dell (DELL)

Last on the list is Dell, a company that I have always wanted to like. Dell has been down, but the company has not sat waiting for defeat to come its way. Dell has responded by spending $2.4 billion in M&A acquisitions on names such as Quest Software (QSFT). This deal arrived shortly after Dell buying SonicWall for an estimated $1.2 billion.

The company is trying to build its software portfolio by buying up niche companies, hoping to offset its deteriorating hardware/PC businesses. Unfortunately, this has not worked so far, and the Street has gotten impatient. In 2013, if Dell can find new ways to grow its high-margin segments (which include networking and storage), it can harvest some value that left in it business.

Dell also must figure out ways to better leverage its recent acquisitions and address a new mobile strategy. This is the only way it can effectively fight back. I've said this before, Dell should do something radical and buy Research In Motion (RIMM). It makes too much sense not to happen. With RIM's existing enterprise footprint, Dell would immediately become relevant again.

The company has spent billions over the past several years acquiring companies that have done little to lift its profile. Dell should realize a change is necessary. Nonetheless, with minimal expectations in these shares, they are just too cheap to pass up. Even on the most conservative assumptions, the stock is worth $15, which represents 36% premium to recent levels.

At the time of publication, the author was long AAPL.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
Richard Saintvilus is a private investor with an information technology and engineering background and has been investing and trading for over 15 years. He employs conservative strategies in assessing equities and appraising value while minimizing downside risk. His decisions are based in part on management, growth prospects, return on equity and price-to-earnings as well as macroeconomic factors. He is an investor who seeks opportunities whether on the long or short side and believes in changing positions as information changes.
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