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On Friday, Rosenblatt Securities reiterated a Sell rating on Intel Corporation (NASDAQ:INTC), maintaining a $20.00 price target. The firm’s analysts pointed to Intel’s fourth-quarter revenue surpassing expectations, with $14.3 billion in revenue compared to the $13.8 billion consensus. Non-GAAP earnings per share (EPS) also slightly exceeded forecasts at $0.13, against an anticipated $0.12 to $0.13 range. According to InvestingPro data, Intel’s market capitalization stands at $86.3 billion, with the company currently burning through cash and showing negative free cash flow of $15.1 billion in the last twelve months.
Despite these modest gains, Intel’s first-quarter guidance for 2025 fell short of analyst predictions, with projected revenues of $12.2 billion and a Non-GAAP EPS of $0.00, significantly lower than the expected $13.0 billion and $0.17 EPS. The company attributed the weak outlook to a variety of factors, including seasonal slumps, uncertainty due to tariffs, a reduction in PC inventory, and continued market share losses. InvestingPro analysis reveals concerning trends, with revenue declining 2.08% over the last twelve months to $53.1 billion. Get access to over 10 additional exclusive ProTips and comprehensive financial metrics with InvestingPro’s detailed research report.
The analysts highlighted several key developments within Intel. Notably, the company’s decision to cancel the market release of its Falcon Shores GPU, which was intended for AI and high-performance computing applications, instead choosing to focus on developing its successor, Jaguar Shores. Additionally, Intel’s existing AI product, Gaudi 3, has received a tepid response, leading analysts to believe Intel will miss out on significant opportunities during the current semiconductor industry boom.
Intel’s management is concentrating on advancing its 18A process node technology, with plans to launch Panther Lake in the second half of 2025 and Clearwater Forest in the first half of 2026. However, analysts anticipate gross margin pressures as Intel ramps up its Foundry services in 2026. On a positive note, the company is on schedule to ship over 100 million AI PCs by the end of 2025, but it is still expected to lose market share to competitors like AMD (NASDAQ:AMD).
In light of these factors, Rosenblatt has revised its financial forecasts for Intel, reducing the fiscal year 2025 revenue and Non-GAAP EPS estimates from $55.0 billion and $1.00 to $52.5 billion and $0.45, respectively. The firm also lowered its fiscal year 2026 estimates from $58.0 billion in revenue and $1.50 in Non-GAAP EPS to $56.0 billion and $1.10. The reaffirmed Sell rating and price target are based on applying a mid-teens price-to-earnings (P/E) multiple to the firm’s projected fiscal year 2026 Non-GAAP EPS. While Rosenblatt maintains its Sell rating, broader analyst targets range from $19 to $31, with InvestingPro’s Fair Value analysis suggesting the stock may be slightly undervalued at current levels. Dive deeper into Intel’s valuation metrics and financial health scores with InvestingPro’s comprehensive research report.
In other recent news, Intel Corporation’s earnings for the fourth fiscal quarter of 2024 met expectations, with reported revenue of $13.8 billion and Non-GAAP EPS of $0.12. However, projections for the first fiscal quarter of 2025 indicate a slight dip, with expected revenue at $13.0 billion and Non-GAAP EPS of $0.17. Amid these financial developments, Intel announced strategic collaborations such as a pilot production line with United Microelectronics Corporation in Arizona and the construction of a new manufacturing complex in Ohio, dubbed the Silicon Heartland. The company also plans to spin off its venture capital arm, Intel Capital, into an independent fund. Analyst firms including BofA, Needham, Bernstein, Mizuho (NYSE:MFG), and Stifel have revised their price targets for Intel, with targets ranging from $19 to $31. The changes in price targets follow Intel’s Q1 2025 guidance, which was set significantly below the typical seasonal trends. These are recent developments impacting Intel’s strategic direction and operational efficiency.
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