Why Analysts Are Chasing Intel Higher

Since Intel Corp. (NASDAQ: INTC) reported its fourth-quarter financial results on Thursday, the reaction so far has been fairly positive. The results handily beat estimates on both the top and bottom lines. Analysts and investors appear to be in agreement and sent the stock higher in Friday’s session.

24/7 Wall St. has included some brief highlights from the earnings report, as well as what a few analysts are saying after the fact.

The company posted $0.79 in earnings per share (EPS) and $16.37 billion in revenue, compared with consensus estimates from Thomson Reuters that called for $0.75 in EPS and revenue of $15.76 billion. The same period of last year reportedly had EPS of $0.76 and $14.9 billion in revenue.

Credit Suisse reiterated its Outperform rating and raised its price target to $45 from $40, implying an upside of % from Thursday’s close ($37.56). This also represents a P/E of roughly 15-times 2018 estimated earnings of $2.98 per share. The firm further detailed in its recent report:

We will continue to challenge management to scrutinize investments, to drive more leverage, and to generate higher levels of free cash flow – but the narrative of “spending scared” is not fully supported by the facts. With low investor expectations, “manageable” guidance and a Feb 9 Analyst Day, we see positive risk/reward.

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A few other analysts recently weighed in on Intel:

• Merrill Lynch reiterated a Buy rating with a $42 price target.
• Jefferies cut its price target to $45 from $46.
• Morgan Stanley upgraded it to Equal Weight from Underweight with a price target of $38.
• Bernstein has a Market Perform rating and raised its price target to $36 from $33.
• Deutsche Bank has a Buy rating and raised its price target from $42 to $43.
• Goldman Sachs has a Neutral rating and raised the price target to $41 from $39.
• Needham raised its price target to $43 from $42.

Shares of Intel were last seen up 2% at $38.34, with a consensus analyst price target of $40.09 and a 52-week trading range of $27.68 to $38.45.

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