Intel stock price target raised to $41.10 from $23.00 at Erste Group

Investing.com - Erste Group has raised its price target on Intel (NASDAQ:INTC) to $41.10 from $23.00 while maintaining a Hold rating on the stock. The new target comes as Intel trades near its 52-week high of $39.65, having delivered an impressive 72% return over the past six months. According to InvestingPro data, the stock currently trades above its Fair Value, suggesting careful consideration is needed at current levels.

The firm cited several encouraging improvements at Intel, including a $15 billion sequential improvement in net debt position, with $4.3 billion in debt reduction, $5.7 billion from the U.S. government, $2 billion from SoftBank, and additional funds from the Altera sale and Mobileye stake sale. With a market capitalization of $181.5 billion and an overall Financial Health score of "Fair" from InvestingPro, these debt improvements could be crucial for Intel’s future performance. Get access to 8 more exclusive InvestingPro Tips and comprehensive financial analysis with an InvestingPro subscription.

Intel is experiencing supply constraints in both Client and Datacenter CPUs at its 10 and 7 process nodes, with the company prioritizing data center products over low-end consumer offerings. Peak constraints are expected in the first quarter of 2026, with inventory projected to deplete by year-end.

The chipmaker’s adjusted free cash flow has turned positive at $900 million, though Erste Group noted several ongoing challenges, including a $2.3 billion loss in the Foundry segment and expectations that non-controlling interest will increase to $1.2-1.4 billion in 2026.

For 2026, Erste Group models gross margins to remain flat year-over-year at over 36% as Lunar Lake and 18A production continue to create headwinds, with the Altera divestiture further diluting gross margin potential by approximately 100 basis points.

In other recent news, Intel Corporation reported its third-quarter 2025 earnings, surpassing both revenue and earnings per share expectations. The company’s earnings per share came in at $0.23, significantly higher than the forecasted $0.01, marking a substantial 2200% surprise. Revenue reached $13.7 billion, exceeding the anticipated $13.13 billion. These results reflect a positive performance for the quarter. Additionally, there are no current updates regarding mergers or acquisitions for Intel. Analyst updates on Intel have not been highlighted in recent reports. Investors and analysts are closely monitoring these developments as they assess Intel’s financial health.

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