Bulls vs. Bears: Can Intel sustain the Q3 rally?
Intel (NASDAQ:INTC) shares closed higher this week after the semiconductor giant reported better-than-expected revenue for Q3 2024 despite a miss in its bottom line, prompting Seeking Alpha analysts to review their bearish bets on the stock.
After losing over half of its value this year, the Santa Clara, California-based company added nearly 8% on Friday as its revenue for the quarter exceeded Street forecasts by $240M, marking its first topline beat for 2024.
In reaction, several SA analysts upped their ratings on the stock while others remained on the sidelines.
The Bulls
“Intel delivered a solid Q3 result, beating the market expectations,” Lighting Rock Research said in “Intel Q3: Another 2 18A Wafer Design Wins; Time To Buy (Rating Upgrade).” ”I think the near-term challenges have already priced in Intel’s stock price. As such, I am upgrading to a “Buy” with a fair value of $28 per share.”
“Intel reported a revenue beat but a huge EPS miss due to restructuring and impairment charges,” added The Value Edge in “Intel: Q3 Marks The Turning Point, Buy (Rating Upgrade).” “This quarter is likely the inflection point for the company as they put major restructuring and impairment charges in the rearview mirror and look forward to ramping new process nodes and technologies.”
“We think INTC still makes for a good trade, considering low expectations and potential upside until the end of the year,” argued SA Investing Group leader Tech Stock Pros in “Intel: Outlook Too Easy To Miss, Buy For The Honeymoon Phase.” We continue to believe INTC isn’t fairly valued at current levels. The stock is undervalued, trading at 2.3x EV/C2024 sales versus a peer group average of 7.2x.
The Bears
“Intel Corporation reported another mixed quarter in Q3, with relatively weak results while the market tries to celebrate earnings beating guidance,” SA Investing Group leader Stone Fox Capital wrote in “Intel Remains Broken.” “The stock shouldn’t be bought until Intel has turned around the business due to the stressed balance sheet and cash burn position.”
“The company’s Q3 release showed many signs of a company in decline,” added SA analyst A.J. Button in “Intel: Why I’m Avoiding This Stock After Earnings.” “The upped guidance was one bright spot, but even after increasing the guidance, management still expects revenue to decline.”