Intel Corporation (NASDAQ:INTC) released its Q4 2017 earnings report on Thursday evening after closing bell tonight, and Wall Street was very pleasantly surprised. The specter of the Meltdown and Spectre vulnerabilities dissipated suddenly as management said they expect no financial impact from them. Intel stock skyrocketed to its highest level in 17 years, more than erasing the losses caused by the two major chip design flaws.
Intel stock upgraded by CS
In a note to investors on the Q4 earnings release, Credit Suisse analyst John Pitzer said he upgraded Intel stock from Neutral to Outperform and boosted his price target from $42 to $55 per share. He noted that Intel stock has modestly underperformed the SOX semiconductor index since March 2017, but his concerns about valuation never materialized, mostly due to better execution from management.
He also pointed out that Intel’s guidance still looks conservative, and its investment rate seems to have peaked. Further, he sees more visibility into future growth.
Oppenheimer analyst Rick Schafer stayed on the sidelines on Intel stock following the Q4 2017 earnings release, maintaining his Perform rating. Although he was “encouraged” to see non-PC revenues moving toward 50% of total revenues, but he sees earnings and free cash flow leverage and growth as still “limited,” which is why he’s still on the sidelines.
Strong guidance sweetens the deal on Intel’s Q4 2017 earnings
KeyBanc analyst Michael McConnell raised his price target for Intel stock from $50 to $60 and reiterated his Overweight rating. He called out the chip maker’s reacceleration in Data Center revenue growth due to the Purley line-up, which is expected to begin this year. He noted that Intel’s data center growth was the strongest in three years, driven by secular growth in the cloud and share gains among networking customers.
He also mentioned guidance as a bright spot in Intel’s Q4 earnings release as he thinks it looks conservative for both the Client Computing Group and Data Center Group. He said cited the chip maker’s strong guidance as the driver for his higher estimates and price target increase for Intel stock.
Roth analyst Suji Desilva raised his price target for Intel stock from $50 to $57 per share and reiterated his Buy rating. He also noted that the chip maker’s guidance for 2018 looks healthy and suggests “sustained momentum.” He expect Data Center revenues to grow in the high-single digits this year on the back of strong cloud and Xeon sales. He also noted product diversification as a positive in Intel’s Q4 2017 earnings release.
Intel stock surged by about 10% to as high as $49.95 in intraday trading on Friday.