“We believe that Intel continues to struggle with its modem business as it is likely unprofitable and consuming capacity that could be deployed for more profitable pursuits. We don’t think the Company can abandon Apple at this point, so a simple solution would be too sell the modem business to Apple. We think it would be a significant catalyst for the shares. We note that this idea and $5 yields a latte, but we still think it is worth consideration. We believe that Intel continues to have issues with its 5G modem development. We have also heard from contacts that the Company is considering manufacturing its 5G modem at TSMC instead of internally. This would likely push commercialization into CY21. In addition, Apple is also Intel’s only customer, and they are opening a facility in San Diego presumably to develop its own modem chips.”
According to TipRanks.com, Richard is a 5-star analyst with an average return of 22.6% and a 65.3% success rate. Richard covers the Consumer Goods sector, focusing on stocks such as Adesto Technologies Corp, Akoustis Technologies, and Power Integrations.
Intel has an analyst consensus of Moderate Buy, with a price target consensus of $54.20.
Based on Intel’s latest earnings release for the quarter ending December 31, the company reported a quarterly revenue of $18.66 billion and net profit of $5.2 billion. In comparison, last year the company earned revenue of $17.05 billion and had a GAAP net loss of $687 million.
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