Reason to Buy IntelThe chip giant will be reporting its second-quarter earnings on Tuesday after market close and analysts are expecting revenue of $13.60 billion -- topping the $13.03 billion it reported in the same period of a year ago. However, while its revenue is expected to arrive on the higher end, it is expected to shed 1 cent from its earnings per share to 53 cents from its report of a year ago of 54 cents. The stock is currently trading at $25.25, almost 20% under the average analyst price target of $29.71. I expect the stock to rise moderately post earnings and expect the company to beat on both the top and bottom lines -- that's what it does. The company has either met or exceeded estimates in each of the past four quarters. As the stock continues to trade at what I believe to be a considerable discount with a price-to-earnings ratio of 9, I see at least 25% more upside in the shares in the near term, putting the stock at $32 and possibly $35 by year-end. Furthermore, the company will undoubtedly log its best financial performance in 2012.
Investors should expect Intel to demonstrate continued strength in emerging markets, from the explosion of smartphones and mobile devices and from corporate and consumer migrations towards cloud infrastructures. If you are a value investor looking for a safe investment in technology and one that pays a respectable dividend, you should consider Intel.