Intel: The Road To Recovery Is Long (Downgrade)

Summary:

  • I’m downgrading Intel to “Hold” due to persistent internal issues, despite previous optimism about Gaudi 3’s long-term potential.
  • INTC’s Q2 report showed disappointing revenue and profitability, with significant earnings misses and competitive pressures impacting margins.
  • Management’s pessimistic Q3 guidance and ongoing challenges from competitors like AMD, Nvidia, and TSMC suggest a tough road ahead for Intel.
  • Despite Intel’s efforts in restructuring and new product launches, I see no immediate end to the headwinds, making it premature to upgrade to “Buy”.

Intel Headquarters

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Intro & Thesis

In late January 2024, I initiated coverage of Intel Corporation (NASDAQ:INTC) with a “Hold” rating and recommended avoiding the stock, as Intel’s business appeared to be an obvious laggard compared to other peers in the technology


Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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