2024-06-10 23:48:05 ET
Summary
- Intel faced significant earnings and price contraction recently, but conditions are improving. The decline was due to high startup costs, rising competition, and macroeconomic stagnation.
- INTC faces strong competition from Nvidia, AMD in chips, and TSMC in foundry services. Despite trends in digitization and AI, expecting Intel to match competitors' high growth is overly optimistic.
- The Company is fairly valued now, unlike its recent overvaluation. This is shown by its low forward price-to-sales ratio and through my DCF model starting with its 10-year average FCF.
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Intel Is Fairly Valued, But Long-Term Challenges Remain (Rating Upgrade)