Technology

Are Analysts Giving Intel Enough Credit After Earnings?

Chris Lange

Published: October 25, 2019 1:35 pm

Last Updated: January 30, 2020 2:03 pm

Intel Corp. (NASDAQ: INTC) released its most recent quarterly results after markets closed Thursday. Overall, this was a record quarter for Intel, but it’s hard to believe considering what a majority of analysts are saying. Despite most analysts being sidelined on the stock, they did give Intel credit for the quarter by raising their targets.

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

The semiconductor giant posted $1.42 in earnings per share (EPS) and a record $19.2 billion in revenue, compared with consensus estimates from Thomson Reuters that called for $1.24 in EPS and $18.05 billion in revenue. In the third quarter of last year, Intel said it had EPS of $1.40 on revenue of $19.16 billion.

The PC-centric business (CCG) was down 5% in the third quarter. Collectively, Intel’s data-centric businesses achieved record revenue in the third quarter, up 6% year over year. The Data Center Group (DCG) delivered record revenue driven by a strong mix of high-performance Intel Xeon processors and growth in every segment of the business. The communications service provider segment grew 11% while the cloud segment returned to growth, up 3%, and enterprise and government revenue grew 1%.

The Internet of Things Group (IOTG) also achieved record revenue, up 9% on strength in retail and transportation. Mobileye achieved record revenue, up 20% year over year on increasing ADAS adoption. Intel’s memory business (NSG) also achieved record revenue, up 19%. PSG third-quarter revenue was up 2%.

Looking ahead to the fourth quarter of 2019, the company expects to see EPS of $1.24 and revenues near $19.2 billion. Consensus estimates call for $1.21 in EPS and $18.82 billion in revenue for the quarter.

Here’s what analysts had to say about Intel:

• Wedbush reiterated a Sell rating with a $46 price target.
• Goldman Sachs reiterated a Sell rating and a $48 price target.
• Sanford Bernstein reiterated a Sell rating with a $42 price target.
• Barclays reiterated an Underweight rating and raised its target to $42 from $40.
• BMO reiterated a Market Perform rating and raised its price target from $50 to $53.
• RBC reiterated an Underperform rating and raised its price target to $48 from $47.
• Morgan Stanley reiterated it as Overweight and raised its price target to $65 from $64.
• Wells Fargo reiterated a Market Perform rating and raised its target to $58 from $55.
• Robert Baird reiterated an Outperform rating and raised its target from $65 to $70.
• SunTrust Banks reiterated it as Hold and raised its target price to $60 from $58.
• Susquehanna reiterated a Neutral rating and raised its price target from $52 to $55.
• JPMorgan reiterated an Overweight rating and raised its price target to $68 from $64.
• Credit Suisse reiterated an Outperform rating and raised its price target to $65 from $58.
• Northland Securities upgraded it to Outperform from Market Perform with a $69 target.
• Cowen reiterated a Market Perform rating and raised its price target to $53 from $50.

Shares of Intel traded up over 7% to $56.19 on Friday, in a 52-week range of $42.86 to $59.59. The consensus price target is $53.13.