Nomura/Instinet Upgrades Intel (INTC) to Buy

Nomura/Instinet analyst Romit Shah upgraded Intel (NASDAQ: INTC) from Neutral to Buy with a price target of $50.00.

The analyst comments "...we believe that Intel will remain supply constrained until the ramp of 10nm, which sets the company up for at least seasonal revenue growth and stronger gross margins through 2Q19E. In an open letter last month (Sept. 28th), interim CEO Bob Swan noted pressure on the factory and tight supply for PC processors (14nm). We see this constraint as a culmination of several factors – Spectre and Meltdown design flaws (4Q17), 10nm processor delay (1Q18), Apple exclusively sourcing the XMM7560 modem (2Q18) and a stronger PC TAM (2Q18/3Q18) – that will be enduring into 2019. In addition, Mr. Swan indicated that Intel would be “prioritizing the production of Intel Xeon and Core processors” to serve the high-performance segments. This also bodes well for earnings and specifically gross margin, which we believe the Street is conservatively forecasting at 60% in 4Q18E and 1Q19E."

For an analyst ratings summary and ratings history on Intel click here. For more ratings news on Intel click here.

Shares of Intel closed at $44.81 yesterday.

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