Intel INTC
What does Intel do?
Intel develops, manufactures and markets processors and related semiconductor products for computers, data centers and embedded systems. The company is one of the few providers that both design chips themselves and produce them in their own fabs. The business is divided into three areas: Client Computing, with CPUs for notebooks and desktop computers as well as graphics and connectivity products; Data Center and AI, with server processors, accelerators and networking products; and Intel Foundry, which offers manufacturing services and packaging technology.
Customers are mainly PC makers, cloud providers, server manufacturers and enterprise customers, who are supplied through its own sales teams and distributors. In the x86 processor market, Intel competes mainly with AMD, and in AI accelerators with Nvidia and other providers. In contract manufacturing, the Foundry division competes with established providers such as TSMC and Samsung. Its positioning depends heavily on whether Intel keeps pace with competitors in manufacturing technology and product architecture.
Score profile
Rank vs. Semiconductors (40 companies). 10 = top of the group, 5 = middle. Calculated from the metrics below, without AI.
Metrics compared with the industry
On profitability and quality, Intel ranks below average in the group Semiconductors (2.3/10). On growth, the company ranks below average in the group Semiconductors (2.5/10). On valuation (higher = cheaper), the stock ranks in the middle in the group Semiconductors (4.2/10). On financial strength, Intel ranks below average in the group Semiconductors (3.4/10).
| Metric | Stock | Group median | Ranking |
|---|---|---|---|
| Forward P/E | 32.5x | 18.7x | better than 17 % |
| PEG ratio | 1.4x | 0.8x | better than 35 % |
| EV/EBITDA | 17.2x | 21.3x | better than 59 % |
| Price/sales | 5.2x | 5.8x | better than 56 % |
| Price/book | 2.7x | 5.1x | better than 78 % |
| Revenue growth | 20.9% | 25.5% | better than 44 % |
| Earnings growth | -32.7% | 7.4% | better than 7 % |
| Gross margin | 40.2% | 53.3% | better than 24 % |
| Operating margin | 15.6% | 15.5% | better than 51 % |
| Net margin | -20.1% | 10.3% | better than 6 % |
| Return on equity | -9.6% | 8.6% | better than 11 % |
| Debt/equity | 38.1% | 36.5% | better than 48 % |
| Current ratio | 2.2x | 3.3x | better than 26 % |
| Free cash flow yield | 0.3% | 1.3% | better than 27 % |
| Dividend yield | 0.0% | 1.2% | – |
| Payout ratio | 0.0% | 38.0% | – |
| Beta | 2.43 | 1.92 | – |
Valuation: what is Intel worth?
Two valuation approaches – a discounted cash flow model and a valuation at the industry’s median multiples – give Intel a model range of 33.50 USD to 72.94 USD per share.
43 analysts, average rating “Hold”, average price target 91.12 USD (+56.8%).
The full DCF matrix, the reverse DCF (what growth the price implies) and scenarios are part of the Pro analysis.
What the business depends on
- Demand for PCs and notebooks largely determines sales in the Client Computing segment.
- Investments by cloud providers and companies in data centers and AI infrastructure shape the server processor business.
- Fab utilization and the success of new manufacturing processes influence costs, margins and the Foundry business.
Risks
- Market share losses to AMD, Nvidia and providers of Arm-based processors may put pressure on prices and margins.
- Delays or quality problems with new manufacturing technologies endanger competitiveness and weigh on profitability.
- Building its own manufacturing capacity ties up a great deal of capital and increases dependence on the economic cycle and utilization.
What to look for with Intel
The gross margin is particularly informative, as it shows whether product mix, fab utilization and manufacturing costs fit together in the capital-intensive business model.