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Intel earnings to give a first glimpse of the extent of the shortage is affecting US chipmakers in 2021.


Intel Corporation – like every other major chipmaker – will have its quarterly earnings report explaining how quickly the industry is managing to alleviate the supply issues that have made it difficult. for semiconductor customers for most COVID-19

Intel
INTC,
-0.42%

Expected to report first quarter earnings on Thursday after the market closes. The report will be the first with Pat Gelsinger to formally preside over as chief executive, after the newly announced successor Bob Swan speaks during a conference call. last quarter about his assessment of the company’s turnaround plans.

Gelsinger has been making waves since the takeover. He announced one Ambitious production expansion plans months ago and more recently, told Reuters that Intel hasn talk to companies Chip design for car manufacturers to start making those chips to deal with widespread shortages of supply.

Read: Shortage of chips worldwide expwill last into next year, and that’s good news for semiconductor stocks

While those plans have received praise from most of the investment community, they are starting to get some feedback from analysts who are wondering if Intel can turn the carrier around. timely or not. This past Thursday, Intel shares received a “ineffective” downgrade from Raymond James’s Chris Caso on fears that the chip maker’s path to regain former glory may be short.

The first quarter results are not expected to show an immediate change for Intel as revenue appears to be down year-on-year for the third consecutive quarter, and earnings are expected to decline significantly relative to the previous year. with a year ago. That’s the big reason investors are more concerned about hearing more about Gelsinger’s long-term plans and how Intel can capitalize on its current semiconductor shortage in search of a needed boost.

What are you looking for

Income: Of the 35 analysts surveyed by FactSet, Intel on average is expected to publish adjusted earnings of $ 1.14 per share, down from $ 1.45 per share reported in quarter 1 year ago. Intel forecasts $ 1.10 a share. Estimize, a software platform that uses community sourcing from hedge fund executives, brokers, buyer analysts, and others, calls for $ 1.21 a share. promissory note.

Revenue: Wall Street expects revenue from Intel to be $ 17.77 billion, according to 30 analysts polled by FactSet. This is down from the $ 19.83 billion reported in the previous quarter. Intel predicts revenue of about $ 17.5 billion. Estimize is expected to reach revenue of 18.36 billion USD.

Analysts expect revenue from client computers, the traditional PC group, to reach $ 10.11 billion, data center revenue of $ 6.18 billion, revenue from non-flexible memory solutions. operations were $ 590.3 million, “Internet of Things” or IoT, $ 1.01 billion in revenue, and Mobileye’s $ 344.2 million.

Ancient movement: Intel shares rose 28.5% in the first quarter. During the same period, the Dow Jones Industrial Index
DJIA,
+ 0.48%

– counts Intel as a component – up 7.8%, S&P 500 index
SPX,
+ 0.36%

Up 5.8%, the tech-heavy Nasdaq Composite Index
COMP,
+ 0.10%

increase 2.8% and the PHLX Semiconductor Index
COMP,
+ 0.10%

11.8% increase.

What analysts are saying

Although Raymond James’s Caso is not optimistic about Intel’s long-term prospects, he says that doesn’t apply to the short-term.

“Our call was not a quarter call – the company recorded an increase in Q1 and released full year guidance a month ago and we believe the short term conditions remain stable,” Caso said.

Cowen analyst Matthew Ramsay, who has a better rating and $ 80 price target, said investors should focus on whether Intel provides an update on its growth and sustainability. data center or not and whether there is any sign of recovery in business and government server sales.

Additionally, Ramsay said it would be helpful if Intel tackles Advanced Micro Devices Inc.’s refreshed portfolio of x86 products. and provide more detail into its 7-nanometer product schedule and roadmap.

Out of 42 Intel analysts, 16 have a buy rating, 15 have a hold rating and 11 have a sell rating, with an average target price of $ 66.57, according to FactSet data.

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