Prior to reporting its earnings, Intel Corp. (NASDAQ: INTC) warned investors to be wary of a recent deceleration in PC sales, and it appeared that no one bet on Intel to perform after this warning. After Intel shocked investors with its earnings and guidance, some analysts have become increasingly optimistic about the future of this company.

Wells Fargo had an Outperform rating on the stock with a valuation range of $40.00 to $50.00. This range is based on an approximate multiple of 16 to 19 times the firm’s 2016 fiscal year earnings per share (EPS) estimate of $2.57. This is within the range in which Intel has traded in the past. Company-specific risks include competition from Advanced Micro Devices Inc. (NASDAQ: AMD) and rising capital spending. Sector risks include the possibility of decelerating growth in PC shipments.

The brokerage giant detailed in its report:

We are impressed with Intel’s earnings report and guidance. Intel is guiding for June quarter revenue and gross margin to both improve sequentially and the company cut its 2015 capital spending plan by more than a billion dollars. However, full year gross margin guidance implies some gross margin pressure in H2 2015. Our 2015 GAAP EPS estimate increases to $2.18 from $2.11. We are leaving our above-consensus 2016 EPS estimate of $2.57 unchanged. We are reiterating our Outperform rating on Intel, which remains our Top Pick. Intel guided for sales of $13.2 billion (±$500 million) in the upcoming quarter. Midpoint of this range is below the consensus estimate of $13.5 billion and above our $12.9 billion prior to the call. Intel guided for gross margin of 62% [±2 percentage points] in the upcoming quarter.

Oppenheimer had a Perform rating for Intel. The first-quarter revenues and EPS were largely in line with its negatively preannounced results back in mid-March. Oppenheimer suggested that while the second-quarter top-line guidance of $13.2 billion was slightly below the street’s $13.4 billion estimate, full-year revenue, now expected flat year over year, was better than feared, likely buoying shares Wednesday. Structural tailwinds in the data center group remain a lone bright spot, in the firm’s view, as the business is likely healthy/unchallenged in 2015. The gross margin trajectory looks to be partially offsetting a better-than-expected top line and lower-than-expected taxes.

Merrill Lynch reiterated a Buy rating for Intel with a $38 price objective. The firm tweaked its 2015 and 2016 EPS estimates to $2.16 and $2.45, respectively. This rating is based on a few ideas from the firm. Merrill Lynch suggested that the first half PC inventory cuts set the stage for a seasonal second half, stimulated by the new Skylake chip and the Windows 10 launch. The data center group remains solid at a 15% year-over-year trajectory, contributing roughly 30% of sales. The gross margin is holding well above the crucial 60% mark despite weak PC unit sales. Merrill Lynch considers that Intel is more a cost-cutting story in 2015 with some assumptions around PC recovery in the third quarter, but the firm believes EPS trends have bottomed, and this should drive a gradual recovery in the stock.

Canaccord Genuity believes that Intel shares are attractive with continued strong data center, Internet of Things (IoT) and NAND momentum. As a result the firm raised its price target to $39 from $38. Canaccord Genuity’s analyst Matthew Ramsay said:

After a large reset of PC expectations for 2015 and the stock price that led to our upgrade of Intel shares, we continue to believe Intel has strong core fundamentals driven by sustained foundry advantages and strong secular momentum supporting 15%+ DCG and 20%+ IoTG growth potential.

Credit Suisse maintained its Outperform rating and $40 price target. The firm detailed in its report:

Intel reported in-line calendar first quarter Revenue/EPS, guided calendar second quarter revenue modestly below but gross margin and EPS well above CS/Street. While INTC’s fortunes are clearly still tied to PCs, the Company continues to minimize the negative impact of declining PC volumes while pivoting towards higher growth segments (DCG, IoT, NVM) en route to what we believe is a LT Rev/EPS compound annual growth rate of 5%/15%. We are raising our calendar year 2015 EPS to $2.20 from $2.10 vs. Street of $2.13.

S&P Capital IQ maintained its Buy rating on Intel. The firm kept its 2015 operating EPS estimate at $2.16 and 2016 estimate at $2.42. The firm reiterated its 12-month target price at $39, on P/E near peers. S&P Capital sees improving PC conditions in the second half and remains optimistic about Intel’s Data Center group, as well as wearables growth.

Other analysts that weighed in on Intel after earnings were:

• Topeka Capital Markets reiterated a Buy rating raised its price target was raised to $36 from $35.
• RBC raised its rating to Outperform from Market Perform.
• Wedbush raised its rating to Outperform from Neutral with a $37 price target.
• Cowen stock with its Market Perform rating and lowered the target to $33 from $36.

Wednesday afternoon, shares of Intel were up 4.5% at $32.91, in a 52-week trading range of $25.74 to $37.90. The stock has a consensus analyst price target of $34.91.

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