Intel Earnings Preview

Intel (Nasdaq: INTC  ) will try to beat its earnings estimates for the fifth consecutive quarter. The company will unveil its latest earnings on Tuesday. Intel develops advanced integrated digital technology products for industries such as computing and communications.

What analysts say:
 

  • Buy, sell, or hold?: The majority of analysts back Intel as a buy. But with 64.1% of analysts rating it a buy, Intel is still below the mean analyst rating of its nearest 10 competitors, which average 65.8% buys. Analysts don't like Intel as much as competitor Qualcomm overall. Thirty-one out of 34 analysts rate Qualcomm a buy compared to 25 of 39 for Intel. Analysts still rate the stock a moderate buy, but they are a bit more wary about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $13.9 billion in revenue this quarter. That would represent a rise of 25.2% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.61 per share. Estimates range from $0.57 to $0.65.

What our community says:
CAPS All-Stars are solidly behind the stock with 95.9% assigning it an outperform rating. The community at large concurs with the All-Stars with 93.6% giving it a rating of outperform. Fools are bullish on Intel and haven't been shy with their opinions lately, logging 2,829 posts in the past 30 days. Even with a robust four out of five stars, Intel's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Intel's profit has risen year over year by an average of 32.6% over the past five quarters. Revenue has now gone up for three straight quarters. The company's gross margin shrank by 6.6 percentage points in the last quarter. Revenue rose 21.1% while cost of sales rose 45.3% to $5.13 billion from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q2

Q1

Q4

Q3

Gross Margin

60.6%

61.4%

64.6%

65.9%

Operating Margin

30.2%

32.4%

35.1%

37.3%

Net Margin

22.7%

24.6%

27.8%

26.6%

For all our Intel-specific analysis, including earnings and beyond, add Intel to My Watchlist.

The Motley Fool owns shares of Intel. Motley Fool newsletter services have recommended buying shares of Intel. Motley Fool newsletter services have recommended creating a diagonal call position in Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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