Intel, the Technology sector company, was revisited by a Wall Street analyst today. Analyst Vivek Arya from Bank of America Securities reiterated a Sell rating on the stock and has a $34.00 price target.
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Vivek Arya has given his Sell rating due to a combination of factors affecting Intel’s current and future performance. Despite some positive trends in demand, particularly from the Windows 11 refresh cycle, Intel faces significant challenges that impact its financial outlook. The company’s gross margin is under pressure, with a forecasted decline to 36.5% in Q4, and a further headwind expected from the Altera divestiture. Additionally, Intel is struggling with tough competition in both its product offerings and foundry services, as well as a lack of a competitive AI accelerator.
Moreover, Intel’s manufacturing scale is suboptimal, with no major external wafer orders, and the slow adoption of its 18A node technology is unlikely to improve its cost structure significantly. The stock appears overvalued, trading at a high price-to-earnings ratio, which seems to be based on speculative assumptions about regaining CPU market share and securing substantial foundry wins. Arya’s analysis suggests that Intel’s current valuation does not align with its projected earnings, leading to a Sell recommendation.
According to TipRanks, Arya is a 5-star analyst with an average return of 17.1% and a 61.90% success rate. Arya covers the Technology sector, focusing on stocks such as Nvidia, Advanced Micro Devices, and Intel.
In another report released on October 22, Rosenblatt Securities also maintained a Sell rating on the stock with a $14.00 price target.