Intel stock fell sharply on Friday, a day after the company gave disappointing guidance for the current quarter. Analysts said it could take a long time for the company to get back on track.
The company remains the world’s largest computer processor maker and is getting a boost from the excitement about artificial intelligence that has benefited Nvidia.
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But unlike its rivals, Intel has not yet generated significant AI chip revenue.
The company on Thursday reported fourth-quarter adjusted earnings per share of 54 cents, compared with Wall Street’s consensus estimate of 45 cents, according to FactSet. Sales totaled $15.4 billion, exceeding analysts’ expectations of $15.2 billion.
But the outlook was weak. Intel’s revenue range for the quarter was $12.2 billion to $13.2 billion, below the consensus estimate of $14.2 billion.
A day after the report, Bernstein analyst Stacey Rasgon reaffirmed Intel’s Market Perform rating and lowered her earnings forecast for this year. “After an even bigger reset, this story probably just moved him to 2026,” he wrote. “We’re very comfortable here on the sidelines.”
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On Friday, Intel shares fell 12% to $43.65, ending a six-day winning streak. This was the biggest percentage decline since July 24, 2020, when the stock price fell 16%.
Similarly, Rick Schaefer and his team at Oppenheimer maintained their Neutral rating on the stock after Thursday’s earnings report. They point out that while Intel’s traditional PC and server markets are not growing rapidly, the company’s AI products are still in “proof” mode.
Needham analysts downgraded Intel stock from “buy” to “hold.” On the Rosenblatt market, longtime Intel bear Hans Mosesmann maintained a “sell” rating with his target at $17.
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“AI seems to be everywhere, except at Intel,” he writes.
Other companies also lowered their price targets for Intel, although they kept their ratings unchanged. Raymond James still rates the stock “outperform,” but lowered his price target from $62 to $50. CFRA maintained a hold but lowered its target from $50 to $45.
Nvidia stock fell 1%. AMD fell 1.7% and IBM fell 1.6%.focused on technology
Nasdaq
The index traded 0.4% lower.
Email Brian Swint at brian.swint@barrons.com.
