Intel (NASDAQ: INTC)
Quality Value Investing Research Report | Updated Coverage | January 2024
Summary:
Intel Corporation was added to the QVI Concentrated Real-Time Stock Picks in 2021 for its industry foothold and legacy status.
Management has shown strong performance in profit margins and returns on equity and invested capital. Still, the enterprise’s downside risks are above average from no moat and undercovered long-term debt.
QVI’s present value analysis shows that shareholder yields underperform the Treasury benchmark, and valuation multiples suggest a fair value to premium-priced stock. However, share price downside risks remain below average.
Regardless of the results and inevitable market overreaction to Intel’s earnings release after the market close today, here’s why Quality Value Investing has changed its rating on the stock.
When referencing this research report, access your Quality Value Investing (QVI) Glossary of Investing Terms and Metric Targets. Unless noted, all data presented is sourced from Seeking Alpha Premium as of the market close on January 24, 2024, and intended for illustration only.
The 43 holdings in the QVI Real-Time Stock Picks portfolio have collectively achieved alpha for 15 years by focusing research and analysis on a company’s current wealth and its share price’s present value. In other words, just the facts without unreliable predictive analysis typical of the buy side or the business modeling overkill of the sell side Wall Street analysts.
In this updated QVI Research Report, we’ll look at the Concentrated Real-Time Stock Picks information technology sector holding Intel Corporation to see if it continues to meet Quality Value Investing’s active portfolio inclusion criteria based on our checklist analysis of the business’s current wealth and its stock’s present value.
Intel: Company Current Wealth
To uncover the current wealth of the company, QVI defines the value proposition, measures returns on management, and assesses enterprise downside risks.
Value Proposition
QVI Research Report’s value proposition section provides a brief synopsis of the company’s business model, major-exchange listing, stock symbol, market capitalization, and dividend-paying status. In addition, it defines the competitive advantages of a company’s products or services to its customers compared to the industry, including the stock’s historical performance vs. the sector and market.
Intel INTC 0.00%↑ is a dividend-paying large-cap stock in the information technology sector’s semiconductors industry. INTC was added to the QVI Concentrated Stock Picks on June 23, 2021, at a split and dividend-adjusted $51.25 a share.
Intel Corporation designs, develops, manufactures, markets, and sells computing and related products worldwide. It operates through Client Computing Group, Data Center and AI, Network and Edge, Mobileye, Accelerated Computing Systems and Graphics, Intel Foundry Services, and Other segments.
The company offers platform products, such as central processing units and chipsets, system-on-chip and multichip packages, accelerators, boards and systems, connectivity products, and memory and storage products. It also provides high-performance computer solutions for targeted verticals and embedded applications for retail, industrial, and healthcare markets; and solutions for assisted and autonomous driving comprising compute platforms, computer vision and machine learning-based sensing, mapping and localization, driving policy, and active sensors.
In addition, the company offers workload-optimized platforms and related products for cloud service providers, enterprise and government, and service providers. It serves original equipment manufacturers, original design manufacturers, cloud service providers, and other equipment manufacturers. The company has a strategic partnership with Synopsys, Inc. to develop EDA and IP solutions and a collaboration with Red Hat to deliver open-source industrial automation to the manufacturing shop floor.
Intel was incorporated in 1968 and is headquartered in Santa Clara, California, USA.
QVI’s value proposition elevator pitch for Intel:
Intel is one of the largest semiconductor companies in the world and holds the lion’s share of the PC and server processor markets. Despite newsworthy headwinds of recent, Wall Street’s bullish sentiment expects its legacy status and market foothold to continue over the longer term. Bearish sentiment does not agree, although short interest remains low.
Due Diligence Resources
For a more in-depth analysis of the all-important value proposition, visit Intel’s investor relations webpage and its most recent Form 10-K Annual Report submitted to the US Securities and Exchange Commission or SEC.
Performance vs. Sector and Market
The chart below illustrates Intel’s performance against the Information Technology Select Sector SPDR® Fund ETF (NYSE: XLK) and the SPDR® S&P 500 ETF Trust (NYSE: SPY) since being added to the QVI Concentrated Real-Time Stock Picks on June 23, 2021.
INTC has underperformed its sector and broader market significantly during Quality Value Investing’s three years of coverage.
QVI’s value proposition rating for Intel: Neutral.
Next, we’ll look at the company’s returns on management and enterprise downsize risks, the share price’s present value, and the investment thesis, each exclusive to Quality Value Investing’s premium (paying) subscribers.