The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK (

Trefis

) --A surprise element during

Intel's

(INTC) - Get Report

earnings announcement was that despite some weakness in the PC market, partially due to cannibalization by tablets, Intel's revenue growth in second-quarter 2011 and guidance for next quarter remain solid. Intel reported that the enterprise PC refresh cycle is helping drive up average selling prices and that emerging markets demand for higher-end chips is increasing.

Intel's rival

AMD

(AMD) - Get Report

reported Friday, and we saw improvements in its business line. Below we take a quick look at what's happening at Intel and what to watch ahead.

Our price estimate for Intel stands at $28,

implying a premium of more than 20% to the market price.

Enterprise Refresh Offsetting Consumer Weakness

According to the last two quarterly reports from research firm IDC, global PC shipments contracted in first-quarter 2011 with a mild recovery in second-quarter 2011. Nevertheless, due to competition from consumer devices like tablets and smartphones, in combination with cautious consumer spending, PC sales were weaker than expected. Despite this, Intel registered significant revenue growth in the PC segment, primarily due to enterprises refreshing their PC lineup and due to the success of Sandy Bridge CPUs.

Impact on Microprocessor ASP

If we talk about the consumer segment, Intel claims that emerging markets are still showing healthy demand. Although this phenomenon puts pressure on ASPs, it is being more than offset by enterprises upgrading their PC lineup and demand for Sandy Bridge processors. Also management said that emerging market demand for higher-quality chips is also increasing.

If we take notebooks, for example, we expect that average selling prices will rise in 2011 and gradually fall thereafter. The idea is that ASP growth is driven by a sudden shift to Sandy Bridge processors, which have the additional functionality of GPUs and are, therefore, higher priced, along with the enterprise PC refresh coinciding with the ramp up. Both of these factors are temporary; so longer-term, a general reduction in semiconductor costs and competition with AMD will drive the prices down.

See our complete analysis for

Intel's stock here

.

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This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.