Intel: Our Upgrade Note Draft Remains At The Ready, Says Canaccord; Raises Price Target
Canaccord analyst Matt Ramsay came out today with an update on Intel (NASDAQ:INTC), following the company’s fourth-quarter results, posting sales of $14.7B – inline with guidance – with very strong 25% Y/Y DCG sales growth offsetting weaker PCCG results. The analyst raised his price target on the stock to $40 (from $35), while his rating is unchanged at Hold.
Ramsay wrote, “Despite mixed Q4/14 results, our view of Intel fundamentals continues to trend more positive given our belief secular drivers support sustained 15%+ DCG and 20%+ IoTG growth for several years. Further, we believe both transistor and platform cost reductions should support solid operating profit levels in PCCG despite renewed risks of slowing PC unit sales as the enterprise WindowsXP upgrade cycle tailwind wanes. In fact, we spent the holiday weekend conducting a deeper analysis with the intention to upgrade Intel shares to BUY; however, given our estimate for essentially no EPS growth in 2015 and a valuation level we believe largely prices in expectations for solid 2016 EPS growth, we just can’t justify the requisite upside.”
Bottom line, “We maintain our HOLD rating, while introducing our 2016 estimates and raising our price target. However, should the stock pull back, our upgrade note draft remains at the ready.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Matt Ramsay has a total average return of -1.1% and a 54.2% success rate. Ramsay is ranked #2560 out of 3428 analysts.