Technology major Intel Corporation (NASDAQ: INTC) recently revealed that it has expanded its strategic alliance with defense major Lockheed Martin (NYSE: LMT) to bring 5G-enabled hardware and software solutions to the Department of Defense (DOD).
Following the news, shares of Intel rose 2.3% on Monday. However, the stock pared its gains slightly to close at $49.12 in the extended trading session.
The expansion of the partnership follows a Memorandum of Understanding (MOU) signed earlier. With this, both the companies stand to benefit from each other’s expertise in their respective fields.
Intel’s prowess in the technological field and 5G capabilities can help Lockheed Martin ensure data-driven decision making across air, sea, land, space and cyber domains in support of national security efforts. Further, Intel is expected to benefit by gaining access to the U.S. military space, including satellites, aircraft, ships and ground vehicles.
Management Commentary
The Corporate Vice-President at Intel, Dan Rodriguez, said, “Together, Intel and Lockheed Martin are utilizing the power of 5G to deliver greater connectivity, faster and more reliable networks, and new data capabilities to the DOD. This shows how cloud, network and edge technologies that are proven in enterprise implementations can also bring significant value to the tactical needs of modern defense systems.”
Stock Rating
Recently, Robert W. Baird analyst Tristan Gerra reiterated a Buy rating on the stock with a price target of $60, which implies upside potential of 21.9% from current levels.
Consensus among analysts is a Hold based on seven Buys, 13 Holds and seven Sells. Intel Corporation’s average price target of $52.85 implies upside potential of 7.4% from current levels. Shares have declined 26.1% over the past year.
Hedge Funds’ Confidence
TipRanks’ Hedge Fund Trading Activity tool shows that hedge fund confidence in Intel is currently Very Negative. Further, the cumulative change in holdings across all 33 hedge funds that were active in the last quarter was a decrease of 9.8 million shares.
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