Intel Corporation (INTC) manufactures and sells essential technologies for the cloud and connected devices for retail, industrial, and consumer uses worldwide.
The company has the scale and scope to lead the fast-growing semiconductor industry again, according to a comment by CEO Pat Gelsinger, following the company’s Q3, 2021 earnings report.
Pat Gelsinger stated: “Q3 shone an even greater spotlight on the global demand for semiconductors, where Intel has the unique breadth and scale to lead. Our focus on execution continued as we started delivering on our IDM 2.0 commitments. We broke ground on new fabs, shared our accelerated path to regain process performance leadership, and unveiled our most dramatic architectural innovations in a decade. We also announced major customer wins across every part of our business.”
He continued by saying: “We are still in the early stages of our journey, but I see the enormous opportunity ahead, and I couldn’t be prouder of the progress we are making towards that opportunity.”
I’m neutral on Intel shares. (See today’s best-performing stocks on TipRanks).
Simply put, Intel is getting bigger and better, ready to accommodate the rising demand for semiconductors that are now central to almost every product, from electronics to home appliances and automobiles. Still, the technology giant has yet to convince Wall Street that it can return to the old glory days.
Intel’s Wall Street Buzz Is Gone
Intel is out of favor with Wall Street. The TipRanks Smart Score rating system assigns the technology giant a score of 3 out of 10, citing negative technicals and bearish news sentiment. As a result, INTC is expected to underperform. Intel’s shares have gained a meager 2.6% over the last twelve months, well below the 57% gain of the semiconductor industry.
Analysts Remain Skeptical
Turning to Wall Street, Intel has a Hold consensus rating, based on five Buys, 10 Holds, and seven Sells assigned in the past three months. The average Intel price target of $53.86 implies 8.4% upside potential. Analyst price targets range from a low of $40.00 per share to a high of $80.00 per share.
A New Leader but Old Problems
At the beginning of the year, Pat Gelsinger, an Intel alumnus, succeeded Bob Swan at the helm of the technology giant. Since then, Mr. Gelsinger has been a new leader trying to solve Intel’s old problems like technology missteps, falling market share, lackluster performance on Wall Street, and hedge fund activism.
In the beginning, Wall Street applauded the new leader. Intel stock gained 11% for the two days that followed the CEO change announcement. Analysts raced to up their target for the technology giant.
However, the honeymoon of the new leader on Wall Street didn’t last long. Nine months later, Intel’s shares are trading roughly at the same level before the leadership change announcement
Apparently, Wall Street doesn’t think that Mr. Gelsinger can fix Intel’s problems fast enough in order to fend off competition and maintain its current market share.
Disclosure: At the time of publication, Panos Mourdoukoutas didn’t own any shares of Intel
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