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Why Intel (INTC) Stock Is Advancing Today

NEW YORK (TheStreet) -- Shares of Intel (INTC - Get Report) are now up 8.61% to $34.44 as the stock hovers near decade highs, after the chipmaker forecast quarterly revenue above analysts' estimates on demand from companies looking to replace old PCs, Reuters reports.

At least 19 brokerages raised their price targets on the stock to $29-$45, while two brokerages raised their ratings to an equivalent of "buy," Reuters noted.

That follows Intel's forecast yesterday of third quarter revenue above the average analyst estimate.

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Intel CFO Stacy Smith told Reuters that PC sales had stabilized, easing fears about the four-year decline in computer sales as consumers turn increasingly to tablets and smartphones.

The company also raised its share buyback program by $20 billion.

TheStreet Ratings team rates INTEL CORP as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:

"We rate INTEL CORP (INTC) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Compared to its closing price of one year ago, INTC's share price has jumped by 34.45%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, INTC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 2.9%. Since the same quarter one year prior, revenues slightly increased by 1.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • INTC's debt-to-equity ratio is very low at 0.23 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, INTC has a quick ratio of 1.68, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The gross profit margin for INTEL CORP is currently very high, coming in at 74.80%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 15.12% trails the industry average.
  • You can view the full analysis from the report here: INTC Ratings Report

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