FBR Lowers Price Target On Intel After Guidance Cut (INTC)
FBR Capital Markets is out with a research report this afternoon cutting the share price of Intel Corp. (NASDAQ: INTC) after the worlds largest chip maker cut its revenue guidance for Q3 by $200 million. It maintains a Neutral rating, but has lowered the price target to $26 from $32.
In a note to clients, FBR writes, "INTC cut its 3Q financial guidance and said consumer spending trends are weak, while server shipments remain robust. INTC reduced its 3Q revenue guidance from $11.6B (+8% QOQ) to $11.0B (+2% QOQ), and gross margins from 67% to 66%. Essentially, back-to-school appears weak as the global macroeconomic environment softens, and that caused some finished system PCs to accumulate at retailers and elsewhere."
It went on to say, "We maintain our Market Perform rating but are lowering our 2010 GAAP EPS estimate from $2.05 to $1.93, our 2011 estimate from $2.20 to $1.90, and our price target from $32 to $26, based on a 12x target multiple of our 1H11 GAAP EPS estimate...".
Shares of Intel are up 30 cents today, good for a gain of 1.66% to $18.48.
