In a sharp display of the difficult state of the U.S. IPO market, Intel Corp. (NASDAQ:INTC) is now expecting to raise a much lower valuation for its self-driving car unit, Mobileye, than it anticipated earlier. The Wall Street Journal reported, citing people close to the developments, that the valuation might be below $20 billion upon listing, which is considerably lower than the initial expectation of a $50 billion valuation.
The people who talked about the developments also said that Intel is seeking to stir more interest among investors by listing fewer shares at a lower price. The shares are expected to hit the stock market on October 26, trading on the Nasdaq exchange under the ticker MBLY.
The IPO market has been clobbered by the upward trek of inflation and interest rates, which have been driving investors (read money) away from equities. More specifically, the losses for self-driving car companies are getting larger and have wiped out significant value from the automotive market. This is another discouraging factor ahead of the Mobileye IPO.
However, the possibility of an improvement in the market (on the back of positive earnings from peers) before Mobileye’s debut prompted Intel to proceed with its roadshow on Tuesday, albeit a day after the scheduled date.
What is Intel’s Stock Prediction?
Wall Street is cautious about Intel stock, with a Hold consensus rating based on four Buys, 15 Holds, and nine Sells. The average price target stands at $36.09, indicating an upside potential of 36.6% from the current price of INTC stock.
