Intel Stock Buy
Intel's (INTC 1.81%) stock jumped 11% on Oct. 28 after the chipmaker posted its third-quarter earnings report. Its revenue declined 20% year over year (and fell 15% on an adjusted basis, which excludes the ongoing divestment of its NAND business) to $15.3 billion, which matched analysts' expectations. Its adjusted earnings dropped 59% to $0.59 per share but still cleared the consensus forecast by $0.26.
intel stock buy
Those headline numbers were dismal, but investors had already tempered their expectations after AMD (AMD 0.13%), Nvidia (NVDA 1.44%), and other chipmakers warned of the PC market's slowdown in a post-pandemic market. A lot of those concerns had already caused Intel's stock to shed more than 40% of its value over the past 12 months.
Instead, investors seemed to mainly focus on Intel's planned cost-cutting measures and its recent spinoff of Mobileye (MBLY 3.96%), which raised $861 million for its former parent in its IPO. But will those streamlining strategies set a floor under Intel's plummeting stock and make it a compelling long-term investment again?
Intel's stock might seem cheap at 15 times this year's adjusted earnings, and it pays an attractive forward dividend yield of 5%. But it also hasn't given investors any compelling reasons to buy its stock -- its core markets are sputtering out, it still remains far behind TSMC in the process race, and cutting costs probably won't help it generate any near-term sales growth. Investors should stay away from Intel for now, especially when plenty of better semiconductor stocks are still on sale.
Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Intel, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends the following options: long January 2023 $57.50 calls on Intel, long January 2025 $45 calls on Intel, short January 2023 $57.50 puts on Intel, and short January 2025 $45 puts on Intel. The Motley Fool has a disclosure policy.
Intel (INTC (opens in new tab)) stock has been lagging the broader market for more than 20 years, hurt by the rise of nimble competitors, manufacturing delays and the fact that the world's largest semiconductor company missed out on some of the biggest changes in technology of the past couple of decades.
True, data centers are an area of growth in a future increasingly powered by artificial intelligence (opens in new tab), but investor interest has shifted to firms that make chips for mobile devices and the Internet of Things. In these endeavors, Intel is an also-ran.
In other words, Intel's current strategy is critical to the stock's long-term success. Bulls contend that if the company is able to deliver on its aspirations, it could provide the catalyst INTC stock needs to shake off its multi-decade run of underwhelming returns.
With that as our backdrop, it's probably at least somewhat disheartening to INTC bulls that Wall Street remains very much on the sidelines on Intel stock. As illustrious and widely held as Intel stock may be, it's a "show me" story at best, analysts say.
Past performance, as we all know too well, is not indicative of future returns, but one look at Intel stock's long-term chart is reason enough to be skeptical about the firm's promises. The chipmaker has tried to reverse its fortunes many times before, and yet INTC stock's track record shows only that investors would have been better served putting their capital elsewhere.
Over the past three years, INTC stock delivered an annualized total return (price plus dividends) of -17.2%. The S&P 500, meanwhile, delivered a three-year annualized total return of 10.4%. At five years, INTC stock's annualized total return stands at -5.1% vs. 10.7% for the broader market.
Of the 43 analysts issuing opinions on Intel stock tracked by S&P Global Market Intelligence, seven rate it at Strong Buy (opens in new tab), two say Buy, 24 have it at Hold, five call it a Sell and five rate it at Strong Sell. Moreover, Intel stock has held a rating no better than Hold since early 2019.
Intel stock trades at just 14.7 times analysts' 2023 earnings per share (EPS) estimate. That's cheaper than the broader market. But then the Street forecasts Intel's EPS to decline at an average annual pace of more than 11% over the next three to five years.
So far this year, the INTC stock price has declined 28.4%, while the tech-heavy Nasdaq-100 Index (US100) and the S&P 500 Index (US500) have fallen 20.7% and 13.3% respectively during that same period.
In the past ten years, Intel stock value has underperformed the two benchmark indices, S&P 500 and NASDAQ-100. During that period, the NASDAQ-100 Index delivered gains of 389.1% resulting in a compounded annual growth rate (CAGR) of 17.2% as per data from Koyfin.
The price action for Intel stock has been quite volatile since the beginning of 2018. During that period, the stock hit all-time highs of around $68 twice but also experienced major declines shortly after hitting that milestone.
Macroeconomic conditions. If the Federal Reserve (Fed) and other central banks opt to keep raising interest rates while adopting more hawkish measures this could put more pressure on the performance of INTC stock.
Intel is a leader in the CPU market but its competitive situation has been hurt lately by rivals, AMD and NVIDIA. The future of the company, and hence the value of its stock, could also depend on how macroeconomic conditions evolve in the next few months. A final resolution to the supply chain crisis may also play a key role in shaping the valuation of this tech company.
Note that any Intel stock forecast and opinion shared above should not be considered a recommendation to buy or sell this tech stock. Traders are encouraged to perform adequate due diligence before making any trading decision. And never invest money that you cannot afford to lose.
The decision to trade or invest in Intel stock should only be made after performing adequate due diligence on the company, its fundamentals, and prospects. And never invest money that you cannot afford to lose.
We have an ongoing authorization (originally approved by our Board of Directors in 2005 and subsequently amended) to repurchase shares of our common stock in open market or negotiated transactions. As of December 31, 2022, we were authorized to repurchase up to $110.0 billion, of which $7.2 billion remain available.
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Intel (NASDAQ: INTC) is a roundly disliked company right now. Is this a good thing or a bad thing? As analysts pile on Intel with bearish forecasts, contrarian investors should consider the potential for a powerful share-price rebound if and when Wall Street learns to love Intel again. With this perspective in mind, I am bullish on Intel stock.
You may have heard that Goldman Sachs (NYSE: GS) analysts recently set a profoundly pessimistic price target of $23 on Intel. Susquehanna (OTC: SQCF) also has a $23 price target on Intel shares. In addition, Needham just slapped a $32 target on INTC stock.
While not quite as pessimistic, other analyst firms have also published their price-objective chop jobs in 2022. In September, for instance, Deutsche Bank (NYSE: DB) reduced its price target on Intel shares from $38 to $35. In a similar vein, Barclays (NYSE: BCS) analysts lowered their price objective INTC stock from $40 to $35 and added insult to injury with an Underweight rating on the shares.
It sure sounds like Intel stock has reached the point of peak pessimism, which is exactly what value investors should want to see. Besides, Intel is apparently preparing to divest part of its business, which is potentially good news as Intel can then focus on its more profitable business segments.
Intel stock last closed at $32.67, up 1.81% from the previous day, and has decreased 34.08% in one year. It has underperformed other stocks in the Semiconductors industry by 0.26 percentage points. Intel stock is currently +32.86% from its 52-week low of $24.59, and -33.64% from its 52-week high of $49.23. 041b061a72