Smf.business.uconn.edu



Company: Intel CorpTicker: INTC Current Price: $ 44.49Industry: Semiconductor – Logic Processors and App specificTarget Price: $ 55Stop Loss: $37.82 (15%)52 Week High/ Low: $33.23/?$?47.30TTM P/E: 16.98Forward P/E: 13.90EPS: $2.62Beta: 1.05Credit Rating: A+ (S&P)Rating Outlook: PositiveMarket Cap: $208.21bAvg Vol (12 M): 25.67mDividend Yield: 2.45%Company Background: Intel Corporation is the second largest chipmaker in the world. It is engaged in making semiconductor chip. It designs and manufactures integrated digital technology products like integrated circuits, for industries such as computing and communications. Intel is a leading manufacturer of integrated circuits. In addition to personal computers, it also serves communications, industrial automation, military, and other electronic equipment market. Main products: microprocessors, microcontrollers, and memory chips. Also sells computer modules and boards, and network products.Industry Outlook: The buildout of next-generation data centers for cloud computing has provided a boost to chipmakers, contract manufacturers and gear makers. Another plus has been the shift to "3D" NAND memory devices. Equipment makers could get a lift by 2019 from China's buildout of new memory chip factories. Applications for automotive semiconductors are required in radar chips, advanced driver assistance systems, hybrid and electric vehicle systems, in-vehicle networking, LED lighting, as well as fuel economy, emissions reduction, and general body and interior elements. Semiconductors used outside of the consumer market must often adhere to higher standards of regulation and robustness. The semiconductor industry is a core element of the entire electronics market.Investment Thesis:While Intel’s recently published third quarter report beat the revenue and EPS estimates, the company also provided stronger Q4 2017 guidance. Intel has a modified business model now around the cloud with its data-centric services. With this fast growing segment, we believe Intel is in a position to get the revenue streams shifting from its original PC chip toward a more integrated and added value segment in the cloud business. The launch of Xeon Scalable, Core 8 chips, Myriad X and next-generation desktop processors are key catalysts. Further, anticipated improvement in cost structure and lower spending, primarily due to improving operational efficiency will aid in expansion of margins going forward. . Intel is currently enjoying the best of both worlds. On one side, it benefits from a strong and stable business generating tons of cash flow. On the other, it has found a growth direction that will lead to its better future in the long run. Intel’s positive indicators of its future growth include its leading position in PCs, strength in servers, growing position in software and IoT segments and headway in process technology.Investment Risks:Intel's scattershot approach to machine learning - Intel has pursued virtually every conceivable option for machine learning except the GPU. It is yet to see which one will evolve into a more capable platforms for machine intelligence.Need for matching capital deployed in memory in conjunction with demand from strategic clients and partners. Most recent quarter financial highlights (July- Sept 2017): Strong Q3 revenue and record EPSData-Centric businesses accounting for 45% of revenue and that from PC-Centric reduced to 55%Financial Performance:Discounted Cash Flow In Millions of USD201220132014201520162017 Est2018 EstRevenue 533415270855870553555938762043.963738.5Operating Profit14638125311564214368148601884119790.3Net Income 11013952111628.611510.211569.715624.215392.2Revenue Growth %-1.22%-1.19%6.00%-0.92%7.28%4.47%2.73%EBITDA%41.54%39.01%43.30%41.69%38.14%41.49%42.7%Operating Profit %27.44%23.77%28.00%25.96%25.02%30.37%31.05%Net Income Margin20.63%18.25%20.95%20.63%17.37%22.82%22.58%D/E0.260.230.220.330.310.390.38EPS2.131.892.312.332.723.253.26PE Ratio 10.4510.8116.1414.0214.2016.2314.21Current Ratio2.432.361.732.581.751.601.70ROE22.6617.5820.5119.5316.2119.519.0ROA14.1610.8912.7011.819.619.7312.64Dividend Per share 0.870.900.900.961.041.081.25FCF7857.010665.010313.011691.012183.010240.512289.82012-172018-22Avg Revenue growth 2.40%12%Avg EBITDA Margin 40.86%42.70%Avg Net Income Margin 20.11%22.7%Avg Debt/Equity 29.00%40%Avg FCF / Margin 19.31%25%Cost of Debt1.01%Tax Rate39.50%Cost of Equity 8.20%WACC7.02%Perpetuity growth rate 6.5%Analyst Opinion Buy:19Hold: 14Sell: 0Target Price Range$32-$58Avg. $46.51Source: Yahoo FinanceRelative ValuationTotal ReturnAMDNVDABroadcomMicrochipIndustry Avg.*P/En.a42.21n.a42.8339.88P/B25.4920.383.575.177.23Dividend Yield n.a0.28%1.15%1.95%1.8%Revn Grth 7.04%7.17%92.5%56.8%34.83%NI Grth 24.7%-0.25%n.a-49.21%29.15%Operating Margin -0.98%14.91%7.4%17.8%15.82%Debt / Equity 3.40.390.620.900.7Market Cap10.73B121.52B107.64 B20.99 B50.5BRevenue TTM4619834416928358112060Net Income TTM-128228617605142560FCF TTM-2291943491511022280* Resource: Bloomberg. AMD and Broadcom operate at loss. AMD does not pay dividend at this time.INTCSemiproductS&P 500YTD27.65%32.99%13.08%20165.28%78.47%11.24%Last 3 Years 37.56%237.76%36.37%Last 5 Years 124.45%397.78%77.29%CSR CharacteristicsINTCIndustry Governance Disclosure Score69.6458.16ESG Disclosure: 52.8938.25Social Disclosure Score43.8635.59Environmental Disclosure Score49.6135.92Data: Bloomberg data of FY 2016 (CSR) ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download