Intel (INTC) Stock Rises on Upgrade, JMP Securities Bullish on Investor Event Remarks

Intel (INTC) shares are gaining on Friday morning after analysts at JMP Securities upgraded the technology company to 'market outperform' from 'market perform' following its investor event.
By U-Jin Lee ,

NEW YORK (TheStreet) -- Intel Corp. (INTC) - Get Report  shares are gaining 0.58% to $34.50 in pre-market trading on Friday after analysts at JMP Securities upgraded the technology company to "market outperform" from "market perform" with a price target of $45 following its investor event. 

On Thursday, Intel hosted its annual meeting where it said that revenue is expected to grow modestly next year due to strong demand for data centers and other products outside the PC market, according to the Wall Street Journal.

Specifically, revenue growth is likely to be in the mid-single digit percentages in 2016, with gross profit margin at 62%.

In addition to these forecasts, Intel added that it would hike its yearly dividend by 8 cents a share to $1.04.

Following these remarks, JMP Securities boosted its rating on the stock, saying, "At its investor event, we feel Intel did a good job of addressing and dispelling the major bear cases against it, and we see this as unlocking multiple expansion."

Overall, analysts believe Intel plays a dominant role in data center and cloud, according to the firm's note.

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

We rate INTEL CORP (INTC) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, notable return on equity, good cash flow from operations and expanding profit margins. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

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

  • The current debt-to-equity ratio, 0.36, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, INTC has a quick ratio of 1.66, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market on the basis of return on equity, INTEL CORP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • Net operating cash flow has remained constant at $5,735.00 million with no significant change when compared to the same quarter last year. Along with maintaining stable cash flow from operations, the firm exceeded the industry average cash flow growth rate of -22.28%.
  • The gross profit margin for INTEL CORP is currently very high, coming in at 78.24%. Regardless of INTC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 21.49% trails the industry average.
  • You can view the full analysis from the report here: INTC
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