Intel Stock Slides Over 11% Following Q3 Earnings and Downgrades

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Intel Stock Slides Over 11% Following Q3 Earnings and Downgrades
Credit: © Reuters.

By Sam Boughedda — Intel Corporation (NASDAQ: INTC ) stock has fallen as much as 11.8% on Friday to levels not seen since January.

The lower open was in reaction to the company's third-quarter earnings. While it posted relatively stable numbers, the company's revenue and data center sales fell short. It also warned that its gross margin and free cash flow would fall over the next two to three years as it invests in research and development and builds new factories.

Intel shares fell around 8% after hours Thursday and opened up Friday at $50.39 but are now trading around the $49.38 level.

Its earnings also triggered a flood of downgrades and lower price targets, which helped increase the pressure on its shares. 

Analysts at UBS, Morgan Stanley, and Mizuho downgraded the stock.

UBS cut Intel to neutral from buy, with analyst Timothy Arcuri reducing the price target to $58 from $73, saying that its unexpected disclosure around the new long-term financial model pushes out its free cash flow recovery.  

Mizuho analyst Vijay Rakesh said Intel's capital-intensive foundry shift adds "uncertainty." Rakesh downgraded Intel from buy to neutral, lowering the price target to $55 from $70. 

Morgan Stanley analyst Joseph Moore lowered his firm's price target on Intel stock to $55 from $67, downgrading the company to equal weight from overweight. Moore said the quarter was fine, and the product pipeline is strong, but the growth forecast seems challenging.

A string of other analysts lowered price targets on Intel, including Citi, which dropped their PT to $52 from $57, Goldman Sachs lowered Intel's price target to $44 from $51, BMO Capital reduced their price target to $60 from $70, and Truist decreased their price target on Intel shares to $52 from $60.

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