Intel (NASDAQ:INTC) shares are expected to open at a fresh 17-month high on Thursday after Mizuho analysts upgraded the rating to Buy from Neutral.
The analysts also raised the price target by $13 to $50 per share.
“Why now? We believe INTC is lining up significant NEW Server product launches and Foundry customer announcements in the next six months,” the analysts said in a client note.
The analysts also highlighted the five key reasons behind today’s upgrade.
- Mizuho analysts believe that Intel has a better product roadmap for Compute and Data Center (DC) in 2024 compared to its peers and historical rollouts.
- The analysts anticipate a positive upcycle in the PC and Data Center industry in 2024, contributing to Intel's potential growth.
- The spinoff of Altera FPGA is seen as adding significant value, estimated at $17 per share.
- The analysts highlight 2025 as a key transition year, particularly with the IFS/18A.
- The analysts suggest that the implied SOTP value for Intel in 2024-25E is around $84 per share.
“INTC trades at ~3x P/S, a discount to AMD (NASDAQ:AMD) and NVDA at ~7.1x/~15x, with significant idiosyncratic tailwinds,” the analysts added.
Intel stock closed at $40.61 on Wednesday, up 53.7% year-to-date.
Shares are indicated 0.6% higher in pre-open Thursday.