Intel (NASDAQ:INTC) is navigating rough waters, with the once-mighty chip giant struggling to regain its footing. As it prepares to report 4Q24 earnings on Thursday (January 30th), investors are eager for results that could spark a much-needed recovery in the stock.
Invest with Confidence:
- Follow TipRanks' Top Wall Street Analysts to uncover their success rate and average return.
- Join thousands of data-driven investors – Build your Smart Portfolio for personalized insights.
Susquehanna’s Christopher Rolland, an analyst ranked in the top 1% of Wall Street stock experts, expects Intel to deliver “generally in-line results and guidance,” with the Q1 outlook featuring “better PC, offset by softer Server and Foundry.”
For the Client segment, Rolland now anticipates notebook builds will grow by +0.1% year-over-year in 2024, an upward revision from his previous call, driven by stronger-than-expected results in December. The strength can probably be attributed to order pull-ins in preparation for potential Trump tariffs. While this dynamic is likely to benefit 4Q24 and 1Q25, it could create risks for 2Q25 and beyond. According to Susquehanna’s 4Q24 PC-SIGnals data, Intel appears to have lost market share in laptop CPUs but gained modestly in desktop CPUs.
“We believe the decline for laptop share may have been a result of Intel’s Lunar Lake just beginning to ramp as Qualcomm’s Snapdragon X and AMD’s Ryzen AI 300 (Strix Point) both made their first appearances last quarter,” the 5-star analyst explained. Yet, driven by its strong performance in power and efficiency benchmarks, Rolland anticipates Lunar Lake will gain share later in the year.
In DCAI, while Intel highlighted improving demand for traditional servers, Rolland sees the potential risks of market share losses to AMD as Granite Rapids and Sierra Forest “continue to ramp slowly.” Given Intel’s comments on the extended qualification and ramp-up timelines for server products, Rolland expects bigger revenue contributions from these products in 2025. The analyst is also anticipating the launch of Intel’s 18A Clearwater Forest in the second half of the year, although significant volume production and margin improvements (as tiles transition in-house) are likely to be “more of a 2026 story.”
On accelerators, Intel introduced Gaudi 3 last quarter but no longer expects to hit its $500 million revenue target for Gaudi in 2024 on account of a “slower adoption rate.” Improved availability of H100 GPUs, as shown by shorter lead times, could further reduce demand for current-gen Gaudi 3. For Q4, Intel has called for flat DCAI revenue, but the question is whether AMD’s share gains, along with ARM adoption at AWS, Google, and Microsoft, are impacting performance.
All told, Rolland rates Intel shares a Neutral, while his price target comes down from $26 to $24. Still, his revised target suggests a potential upside of ~18% from current levels. (To watch Rolland’s track record, click here)
The Street’s average price target is only a touch lower; at $23.61, the figure makes room for 12-month returns of ~16%. Most analysts are also sitting this one out for now; based on a mix of 22 Holds, 4 Sells and a single Buy, the stock claims a Hold consensus rating. (See Intel stock forecast)
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
