Earnings Preview: What to Expect When IBM and Intel Report Thursday

By Chris Lange Published Jan 20, 11:07AM EST

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Earnings Preview: What to Expect When IBM and Intel Report Thursday — © Bet_Noire / Getty Images

Only a handful of Dow Jones industrial stocks are reporting this week, but a couple of the major tech players have yet to come out with their numbers. Intel Corp. (NASDAQ: INTC | INTC Price Prediction) and International Business Machines Corp. (NYSE: IBM) are each set to report after the markets close on Thursday.

24/7 Wall St. has put together a preview of what to expect from both reports. We have included what analysts are calling for in terms of consensus estimates, as well as a recent price history and where the stock is trading currently.

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In an industry that has vastly outperformed the market in 2020, Intel has been a real laggard. For the whole of 2020, Intel was the only semiconductor stock in the S&P 500 to post a loss.

Intel’s problem over the past year has mainly been competition from the likes of Nvidia and AMD. Some analysts believe that the competition just makes better chips and the products speak for themselves, resulting in what has been a lackluster performance for 2020.

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However, 2021 could be the year in which Intel finally gets it together and strikes back. That may be a lofty goal as, for the fourth quarter, analysts are predicting a significant drop in both earnings and revenues year over year. The consensus forecast is $1.10 in earnings per share (EPS) and $17.49 billion in revenue. The same period of last year reportedly had $1.52 in EPS and $20.21 billion in revenue.

Intel stock traded up about 1% on Wednesday to $58.73, in a 52-week range of $43.61 to $69.29. The consensus price target is $57.59.

While Intel may be in bad shape among semiconductors, IBM is in worse shape. It is among the worst-performing Dow stocks over the past 52 weeks, with its shares down about 7% in that time.

A recent study showed that IBM had fallen behind Chinese tech firm Alibaba in terms of cloud computing revenue. Cloud revenue is the measure that IBM has used for investors to gauge its progress. Based on that, IBM continues to fall further and further behind the world’s leaders, which undermines any hope that a years-long turnaround has any chance of success.

For the most part, analysts have tended to be very bearish on this stock, and it really shows in the estimates for the fourth quarter. The consensus estimates call for $1.79 in EPS on $20.67 billion in revenue. In the fourth quarter of last year, $4.71 in EPS and $21.78 billion in revenue were posted.

IBM stock was traded up about 1%, at $130.20 in a 52-week range of $90.56 to $158.75. Analysts have a consensus price target of $138.20 for the stock.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.