Intel (INTC) Numbers 'Do Not Match Wall Street Euphoria'; Goldman Reiterates Sell

January 17, 2014 9:11 AM EST
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Price: $25.77 -2.31%

Rating Summary:
    21 Buy, 23 Hold, 14 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 10 | Down: 4 | New: 31
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Goldman Sachs reiterated a Sell rating on Intel (NASDAQ: INTC) with a price target of $16.00. Comments follow Q4 results that were below consensus. Analyst James Covello continues to view revenue & implied EPS guidance as too aggressive.

"We believe the Street is also overly bullish on INTC, as several analysts have upgraded the stock in the last five weeks on expected upside to EPS guidance, supposedly driven by PC stabilization & Data Center (DCG) growth," said Covello

"We believe the 4Q report and 1Q guidance confirm our view that there is downside, not upside, to Intel's 2014 EPS. Intel's implied 1Q14 EPS is $0.39 at the midpoint, below the Street at $0.42. Specifically, we see risks to 2014 revenue guidance on (1) a headwind from the corporate PC refresh cycle ending after 1Q and (2) DCG continuing to underperform vs. expectations. Additionally, we believe there is risk to Intel's 2014 GM guidance as it is guiding for GM to rise from 59% to low 60s throughout the year despite excess capacity, continuing core PC weakness and "contra revenue" from tablet sales," he added.

For an analyst ratings summary and ratings history on Intel click here. For more ratings news on Intel click here.

Shares of Intel closed at $26.54 yesterday.

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