On Friday, Citi revised its price target for Intel Corporation (NASDAQ: NASDAQ:INTC), reducing it from $35.00 to $25.00, while maintaining a Neutral rating on the stock.
The adjustment follows Intel's recent financial report and guidance that did not meet market expectations, primarily due to a downturn in its PC business, which accounted for 58% of the company's sales in the second quarter of 2024, and rising manufacturing costs.
The report by Citi acknowledged the disappointment in Intel's performance but indicated that despite the unfavorable results, Intel's internal manufacturing strategy is proceeding as planned. This aspect is central to Citi's current rating of the stock. The firm adjusted its estimates for Intel downward in response to the latest financial data.
The analyst from Citi expressed skepticism regarding the success of Intel's foundry business, suggesting that it may not align with the best interests of the company's shareholders. This concern was a contributing factor to the decision to lower the price target for Intel shares.
In summary, Citi's position reflects a cautious outlook on Intel, factoring in both the challenges faced by the company in its core PC market segment and uncertainties about the viability of its foundry business. The firm's reiterated Neutral rating and revised price target are based on these considerations.
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