Intel Corp. (INTC) shares jumped to the top of the Dow Jones Industrial Average
BAML analysts said that while concerns over delays in the group's 10nm product line persist, its move into business-to-business markets will support higher free-cash flow generation and improved profit margins. BAML upgraded its rating on the stock to "buy", with a price target of $60, and sees 2019 revenue growth of around 2.5%.
"Global growth slowdown is a risk but product shortages in late 2018 and replacement demand from aging base PCs helped Intel avoid excess inventory concerns seen by its peers," the bank noted. "Our estimates could have further upside if the next Intel CEO de-emphasizes lwo-margin memory business."
Intel shares were rising 5.64% on Friday to $47, a move that trims its six-month decline to around 8%.
Intel shares have fallen some 10% since former CEO Brian Krzanich left the group on June 21 after an investigation found he had a consensual relationship with an employee that violated company policy.
Bob Swan, Intel's CFO, was named an interim head following Krzanich's departure, but has said he doesn't want to remain in the role permanently.
"I love my job," he told CNBC last month. "I've been a CFO for a long time and I'm not terribly worried bout the middle initial in my title. I think this company deserves a phenomenal CEO and I'm very excited about working with him or her once it gets determined"