RBC Capital Reiterates Sector Perform on Intel (INTC) Following 3Q Beat
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RBC Capital reiterated a Sector Perform rating on Intel (NASDAQ: INTC), and cut the price target to $37.00 (from $38.00), following the company's 3Q earnings report. INTC reported revenues of $15.78B, ahead of the Street's $15.58B. EPS was reported at $0.80 vs. the Street's estimate of $0.73.
Analyst Amit Daryanani commented, "While investors will likely be slightly disappointed at the below seasonal revenue guide, driven by a PC supply chain inventory reduction and a new high-single-digit y/y DCG guide, gross margins continue to surprise to the upside, softening the weaker revenue expectations. With Dalian startup costs likely declining given stronger yields and restructuring charges continuing into mid-2017, we think that 1H17 will likely see continued cost reductions, which should help both the COGS and OpEx lines. Following the report, we continue to see DCG growing double digits although we think a more bullish 15% y/y target is probably out of the question unless Enterprise stabilizes. We think the bulls will point to DCG reaccelerating and PCs stabilizing, which probably results in an EPS scenario of $3.00+; however, bears will likely point to further PC market declines, a deteriorating core Enterprise business in DCG, and a slowing of Cloud/networking-centric DCG spend (flat EPS scenario). Maintaining SP and lowering price target to $37 from $38."
Shares of Intel closed at $37.75 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst EPS View, Analyst PT Change
Related EntitiesRBC Capital, Earnings
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