Today was a big day for chip stock Intel (INTC), or more specifically, its shareholders. Not only did shareholders approve the CEO’s pay package, they also approved a plan to recruit and keep top talent in the face of fundamentally changing conditions. They passed on the chance, meanwhile, to re-evaluate their Israeli operations. All that together sent shares up fractionally in Wednesday afternoon’s trading.
This was the first shareholders’ meeting for new CEO Lip-Bu Tan, reports noted, and he came out nicely ahead. The plan calls for Tan to receive $42 million in stock awards, based on Intel’s share performance, reports noted. This also suggests that Intel shareholders have faith in Tan’s ability to turn things around at the struggling chipmaker.
Beyond that, Intel shareholders also approved a plan to make more of themselves, specifically, out of the employees. Shareholders voted to increase share reserves, which in turn would be doled out to the employees in a bid to keep talent in play. Keeping talent at Intel has proven a little difficult in recent months, as Intel has engaged in a set of layoffs. The most recent layoff effort revealed would see about 20% of the company gone outright, though the exact quantity of those layoffs is still somewhat unclear.
What The Shareholders Refused
Of course, the shareholders did not pass everything put in front of them. One proposal, which would have required Intel to reconsider its entire operation in Israel, was rejected. Proposal 5, as it was known, would have urged the board of directors to “…conduct an Ethical Impact Assessment” of business operations in Israel. The board, for its part, recommended that proposal be rejected, due mainly to Intel’s “…significant investments and presence in Israel.” The cancellation of these would, in turn, “…likely cause significant harm.”
Intel shareholders also refused proposals to improve transparency in its charitable giving operations, as well as giving shareholders “…the right to act by written consent.” Why these proposals were panned, meanwhile, was not revealed.
Is Intel a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 26 Holds and four Sells assigned in the past three months, as indicated by the graphic below. After a 33.04% loss in its share price over the past year, the average INTC price target of $21.29 per share implies 6.18% upside potential.
