Intel Corp. (NASDAQ: INTC) plans to increase the prices of most of its main products in autumn due to rising production and material costs, a report published by Nikkei Asia said, citing people familiar with the matter.
The California-based tech giant plans to hike the prices of chips for Wi-Fi, central processing units (CPUs) for computers and servers, and other peripheral chip products and microprocessors. However, the percentage of increase has not been finalized yet. Quoting sources, the report stated, “It is likely to range from a minimal single-digit increase to more than 10% and 20% in some cases.”
On July 14, Intel declared a quarterly dividend of $0.365 per share, which will be payable on September 1. Shareholders of record on August 7 will be paid the dividend.
The company is scheduled to release its second-quarter results after the market closes on July 28. The consensus EPS estimate stands at $0.70 per share, lower than the year-ago figure of $1.28 per share.
In the first quarter, Intel reported earnings of $0.87 per share, down 37.4% year-over-year but higher than the Street’s estimate of $0.79 per share. Revenues fell 7% to $18.4 billion.
Wall Street Trims Its Estimates on Intel
On July 11, Barclays (NYSE: BCS) analyst Blayne Curtis maintained a Sell rating on the stock and lowered the price target to $40 from $45 (6.1% upside potential).
Curtis has trimmed his estimates for the second and third quarters, as well as full-year 2022 and 2023. He expects the company to miss analyst expectations for these periods.
On TipRanks, the stock has a Hold consensus rating based on five Buys, nine Holds, and five Sells. Intel’s average price target of $49.40 reflects upside potential of 31% from current levels. Shares of Intel have lost 30.5% over the past year.
Hedge Funds Shy Away from Intel
TipRanks’ Hedge Fund Trading Activity tool shows that confidence in Intel is currently Very Negative, as the cumulative change in holdings across all 35 hedge funds that were active in the last quarter was a decrease of 10.3 million shares.
Intel’s Investors Should Wait and Watch
Following the end of the COVID-19 pandemic-driven boom, the chip manufacturing industry has been facing a lot of headwinds from the falling demand for personal computers (PC) and mobile devices. Inflationary pressures and supply chain issues have added to the woes of chip manufacturers.
Even though INTC stock is trading near its all-time low, investors should wait until the price correction in the PC end market is clear.
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