UBS Reiterates Buy on Intel (INTC) Following 3Q15 Earnings Results
UBS reiterated a Buy rating and $33.00 price target on Intel (NASDAQ: INTC) following the company's 3Q15 earnings results. Intel was able to meet its gross margin guidance of 63% in this downcycle as desktop and notebook chip prices were up YOY by 8% and 4% from a more favorable mix of sales of its new Skylake chip.
Analyst Stephen Chin commented, "We keep our Buy rating as Intel's solid execution in this 3Q15 PC downcycle gives us confidence it can still grow EPS by 10%+ even in years that PC demand is flat to down yoy. We believe growth in data center, memory and internet of things can more than offset flat to slightly down PC demand. Intel was also able to meet its gross margin guidance of 63% in this downcycle as desktop and notebook chip prices were up yoy by 8% and 4% from a more favorable mix of sales of its new Skylake chip. We believe a key takeaway from next month's analyst meeting will be its 2016 gross margin guidance which we model flat yoy at 62%. We believe lower depreciation from 2015 capex (down –28% yoy) can offset startup costs from 10nm and a positive outlook on 2016 gross margin could be a catalyst for the stock."
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 $32.04 yesterday.