NEW YORK (TheStreet) -- Shares of Intel (INTC) - Get Intel Corporation (INTC) Report were falling 4.8% to $34.10 Tuesday following Microsoft's (MSFT) - Get Microsoft Corporation (MSFT) Report quarterly earnings report.
Microsoft said that Windows Pro and non-Pro revenue fell 13% year over year in the fiscal second quarter. The company blamed the lower Windows Pro revenue on slowing business PC sales, academic discounts, and an unfavorable mix. Non-Pro revenue fell due to a shift towards cheaper PCs.
Intel stock fell due to the slowing PC sales and shift towards cheaper consumer PCs. The news comes a day after Seagate's (STX) - Get Seagate Technology PLC Report low fiscal third quarter guidance caused shares of the chipmaker to fall.
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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 solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. 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:
- Powered by its strong earnings growth of 45.09% and other important driving factors, this stock has surged by 45.83% over the past year, outperforming the rise in the S&P 500 Index during the same period. 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.
- INTEL CORP has improved earnings per share by 45.1% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, INTEL CORP increased its bottom line by earning $2.33 versus $1.88 in the prior year. This year, the market expects an improvement in earnings ($2.40 versus $2.33).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Semiconductors & Semiconductor Equipment industry average. The net income increased by 39.5% when compared to the same quarter one year prior, rising from $2,625.00 million to $3,661.00 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 10.6%. Since the same quarter one year prior, revenues slightly increased by 6.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- INTC's debt-to-equity ratio is very low at 0.24 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.15, which illustrates the ability to avoid short-term cash problems.
- You can view the full analysis from the report here: INTC Ratings Report