Intel Faces Weak Demand in PC and Data Center Businesses, Analysts Express Concerns

JP Morgan's Harlan Sur lowered their price target on Intel (NASDAQ: INTC) by 5.4% from $37 to $35 on 2024/04/26. The analyst maintained their Strong Sell rating on the stock.

Sur's revised price target reflects a negative outlook on Intel's performance, following the company's first-quarter 2024 earnings report. Despite Intel beating expectations for EPS, with $0.18 compared to the Zacks Consensus Estimate of $0.13, Sur highlighted concerns about ongoing demand weakness in Intel's PC and data center businesses. Intel reported revenue of $12.7 billion for Q1 2024, slightly missing the Zacks Consensus Estimate of $12.9 billion.

Intel's management guidance for Q2 2024 fell well below expectations, with an EPS forecast of $0.10 and revenue projected to be between $12.5 billion and $13.5 billion. This guidance, coupled with the challenges in the PC and data center sectors, contributed to Sur's decision to maintain the Strong Sell rating on Intel.

Other analysts also revised their price targets and ratings for Intel on April 26, 2024. Joseph Moore of Morgan Stanley lowered their price target by 25% to $36 and maintained a Hold rating on the stock. Aaron Rakers of Wells Fargo lowered their price target by 11.6% to $38 and also maintained a Hold rating. Matt Bryson of Wedbush lowered their price target by 18.8% to $32.5 and held a Hold rating as well.

According to WallStreetZen, 21.7% of top-rated analysts currently rate Intel as a Strong Buy or Buy, while 65.2% consider it a Hold. Only 13% recommend or strongly recommend selling the stock.

Looking ahead, the consensus forecast among analysts is that Intel's next yearly earnings per share (EPS) will be $1.12, representing a 16.8% increase on a year-over-year basis. However, investors should note that since Intel's quarterly report on April 25, 2024, the stock price has declined by 9.2%. On a year-over-year basis, the stock has seen a 9.7% increase. Despite this, Intel is trailing behind the broader market, as the S&P 500 has surged by 25.7% during the same period.

JP Morgan analyst Harlan Sur, who lowered Intel's price target, is ranked in the top 3% of Wall Street analysts by WallStreetZen. Sur specializes in the Technology sector and has an average return of 23.2% with a 70.5% win rate.

Intel Corporation, headquartered in Santa Clara, California, is a global company that designs, manufactures, and sells computer products and technologies. Its product offerings include central processing units, chipsets, accelerators, connectivity products, and memory and storage products. Intel serves a wide range of customers, including original equipment manufacturers, original design manufacturers, and cloud service providers. The company is also focused on developing high-performance compute solutions for various industries and solutions for assisted and autonomous driving.

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