NEW YORK (TheStreet) -- Intel (INTC) - Get Report was gaining 1.1% to $25.91 Monday after the chipmaker announced its invested $740 million in Cloudera, giving it an 18% stake in the Big Data software maker.
The investment values Cloudera at $4.1 billion. Intel announced a "significant" investment in the software company last Thursday, but only disclosed the amount Monday.
Cloudera helps other companies manage Big Data using open-source software Hadoop. As part of the investment deal Intel will abandon its customized version of Hadoop that was designed to run optimally on its chipsets.
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 multiple strengths, 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 increase in stock price during the past year, revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- Despite its growing revenue, the company underperformed as compared with the industry average of 5.2%. Since the same quarter one year prior, revenues slightly increased by 2.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Although INTC's debt-to-equity ratio of 0.23 is very low, it is currently higher than that of the industry average. To add to this, INTC has a quick ratio of 1.75, 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 75.56%. 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 18.97% trails the industry average.
- You can view the full analysis from the report here: INTC Ratings Report
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.