intel (international trade commission – Free Report ) has been one of the most searched stocks on Zacks.com recently, so it’s a good idea to take a look at some facts that could shape the stock’s performance in the near term.
The world’s largest chipmaker’s stock has returned -6.7% over the past month versus a +7.1% change in the Zacks S&P 500 Composite Index. The Zacks Semiconductor – General industry, which includes Intel, has gained 22.2% in this period. The key question here is where the stock is likely to go in the short term.
Media reports and rumors about major changes in a company’s business prospects typically influence the behavior of a company’s stock price, leading to immediate price fluctuations, but there are certain There are always fundamental factors.
Regarding revisions to performance forecasts
At Zacks, we prioritize evaluating changes in company earnings estimates rather than focusing on anything else. This is because we believe that the fair value of a stock is determined by the present value of its future income stream.
Our analysis is fundamentally based on how the sell-side analysts covering a given stock are revising their earnings estimates to account for the latest business trends. As a company’s earnings expectations rise, so does the fair value of its stock. And when a stock’s fair value is higher than its current market price, investors tend to buy the stock, which causes the stock price to rise. For this reason, empirical research has shown that there is a strong correlation between trends in earnings forecast revisions and short-term stock price movements.
For the current quarter, Intel is expected to post earnings of $0.10 per share, which would represent a -23.1% change from the year-ago period. The Zacks Consensus Estimate has changed -270% over the past 30 days.
The consensus earnings estimate of $1.05 for the current fiscal year indicates no change from the prior year, with this estimate having changed -85.7% over the past 30 days.
Next year’s consensus earnings estimate of $1.86 represents a +77% change from the earnings Intel was expected to report a year ago. Over the past month, the forecast has changed by -9.3%.
The Zacks Rank, a proprietary stock evaluation tool with a strong, outside-audited track record, effectively harnesses the power of earnings estimate revisions to deliver a more definitive picture about near-term stock price direction. We provide. The magnitude of the recent consensus estimate change, along with three other factors related to the earnings estimate, gives Intel a Zacks Rank #4 (Sell).
The chart below shows the company’s consensus EPS estimate over the next 12 months over time.
12 months EPS
Expected revenue growth rate
Earnings growth is arguably the best indicator of a company’s financial health, but nothing will happen if a company can’t grow its revenue. After all, it’s nearly impossible for a company to increase profits over a long period of time without increasing revenue. Therefore, it’s important to know a company’s earnings growth potential.
For Intel, the consensus revenue estimate for the current quarter is $12.96 billion, representing a year-over-year change of +0.1%. Forecasts for the current and next fiscal year are $55.69 billion and $62.83 billion, representing changes of +2.7% and +12.8%, respectively.
Last reported results and surprising details
Intel reported revenue of $12.72 billion in its last reported quarter. This corresponds to a +8.6% year-over-year change. EPS for the same period was $0.18, compared to -$0.04 a year ago.
The reported revenue represents a surprise of -0.29% when compared to the Zacks Consensus Estimate of $12.76 billion. EPS surprise was +38.46%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company has surpassed consensus revenue estimates three times during this period.
evaluation
You cannot make efficient investment decisions without considering stock valuation. To predict a stock’s future price performance, it is important to determine whether the current price accurately reflects the intrinsic value of the underlying business and the company’s growth prospects.
The present value of a company’s valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), and the past value of your company Comparing a company to its peers based on these parameters will help you see how reasonable its stock price is. You can get a good idea of what
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) categorizes stocks into five groups, ranging from A to F, with A being B B is better than C, and so on), and can help identify whether a stock is overvalued, fairly valued, or temporarily undervalued. Masu.
Intel is rated D on this score, indicating that it trades at a premium compared to its industry peers. Click here to see the values of some of the metrics that determined this grade.
conclusion
The facts discussed here, and many others on Zacks.com, may help you decide whether the market buzz surrounding Intel is worth paying attention to. However, the company’s Zacks Rank #4 suggests it may underperform the broader market in the short term.
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