UPDATE: UBS Downgrades Intel (INTC) to Neutral

UBS analyst Timothy Arcuri downgraded Intel (NASDAQ: INTC) from Buy to Neutral with a price target of $58.00 (from $73.00).

The analyst comments "The unexpected disclosure around the new long-term financial model, capex, and margin trajectory finally provides a framework for the next few years to which the stock can anchor itself and rips off the proverbial band-aid on gross margins. To that end, the 51-53% gross margin targets for the next 2-3yrs is not great but also not terrible given where some investors feared and the C2022 revenue guidance is actually a little better
than Street. The issue for us is now one of duration and the data center narrative. So, even as we remain strong believers that INTC will ultimately catch up in terms of the manufacturing and the relationship with TSMC is a big positive for the product roadmap, the upside catalysts over the next 12mos are less clear to us given the capex commentary. So, we are downgrading and cutting our PT to $58 and we will look for more evidence that this higher than expected capex will start to yield incremental customer engagement as the signal to get more positive again."

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 $56.00 yesterday.

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