On Wednesday, Deutsche Bank resumed coverage of Intel Corporation (NASDAQ:INTC) with a Hold rating, setting a price target of $23.00. According to InvestingPro data, analyst targets for Intel currently range from $14.00 to $28.30, with 29 analysts recently revising their earnings expectations downward for the upcoming period. The bank’s analysts have expressed cautious optimism about the company’s future under the leadership of new CEO Lip-Bu Tan, acknowledging his potential to craft a strategy for transformation that could lead to profitable and sustainable growth. However, they also noted that the execution of this strategy and the realization of these goals are expected to be challenging and time-consuming.
The analysts expect that in the near to medium term, Intel will continue to face macroeconomic uncertainties and company-specific challenges, including high manufacturing costs and a lack of leadership products, which could impact revenue and profitability. InvestingPro analysis reveals Intel’s current financial health score as WEAK, with the company reporting a revenue of $53.04 billion but showing negative profitability over the last twelve months. Want deeper insights? The comprehensive InvestingPro Research Report for Intel offers detailed analysis of the company’s financial health and growth prospects. Despite Intel’s announced cost-cutting measures to mitigate these impacts, the path to significant earnings per share (EPS) and free cash flow (FCF) generation is seen as uncertain and heavily reliant on the success of the company’s Foundry business.
Deutsche Bank suggests that if Intel manages to improve its manufacturing processes, enhance its product roadmap, and secure some foundry customers, the financial upside could be substantial, with a potential Deutsche Bank EPS estimate of approximately $2 in 2027. They believe that CEO Lip-Bu Tan’s technological expertise, focus on customers, and conservative communication strategy improve the likelihood of a successful turnaround for Intel, but details of his strategic vision are still forthcoming.
The bank has decided to maintain its Hold rating on Intel stock and is awaiting further information on the new CEO’s strategic plans or more concrete signs of the company’s progress before reconsidering their position. Despite recent challenges, InvestingPro data shows Intel has demonstrated strong returns over the last month, though its market capitalization stands at $92.78 billion. Subscribers to InvestingPro gain access to over 30 additional key metrics and insights for Intel, along with real-time updates and expert analysis.
In other recent news, Intel’s financial chief, David Zinsner, revealed that the company’s chip manufacturing for external customers remains at a low volume. This disclosure came during the Global Technology, Media and Communications conference. Intel’s foundry unit reported $4.7 billion in sales for the March quarter, marking a 7% increase from the previous year, although the majority of these sales were for Intel’s own products. Meanwhile, shareholders have approved measures to increase share reserves, a move aimed at attracting new employees and compensating the new CEO, Lip-Bu Tan. Stifel analysts have maintained a Hold rating on Intel stock with a $21 price target, expressing cautious optimism about the company’s new direction. Cantor Fitzgerald also maintained a Neutral rating with a $26 price target, highlighting Intel’s ongoing commitment to its Foundry business. ARM has gained microprocessor market share, increasing by 281 basis points to a total of 13.6%, while Intel’s share decreased by 182 basis points, now at 65.3%. These developments indicate Intel’s strategic shifts and ongoing challenges in the competitive semiconductor industry.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.