Intel Prepares for Q1 Earnings Amid Mixed Stock Signals

Intel is set to disclose its first-quarter earnings on Thursday, with Wall Street anticipating earnings per share (EPS) of one cent and revenues of $12.30 billion. The company will issue its report after market hours.

Currently, Intel’s stock has fallen by 39% over the past year, although it has seen a nearly 4% increase so far in 2023.

Examining technical indicators, Intel stock presents a mixed outlook as it approaches its earnings report. The eight-day and 20-day simple moving averages (SMAs) lie below the current share price of $21.11, suggesting short-term bullish momentum. In contrast, the longer-term 50-day and 200-day SMAs are above the current stock price, positioned at $22.29 and $22.69 respectively, indicating that Intel is still entrenched in an overarching downtrend.

Chart created using Benzinga Pro

Investor sentiment is tempered as the Moving Average Convergence Divergence (MACD) stands at a negative 0.67, while the Relative Strength Index (RSI) registers at 50.96—both metrics reflecting neutral-to-bearish market sentiment. This suggests that unless the upcoming earnings report provides a positive surprise or additional restructuring updates gain momentum, Intel stock may find it difficult to build consistent upward momentum.

Notably, the stock rose over 5% midweek after reports surfaced indicating that Intel is considering a reduction of 20% of its workforce. This strategic move aims to enhance efficiency in its manufacturing operations, which have been financially underperforming. While layoffs commonly lead to market unease, this action is regarded by some as a necessary step towards reinstating fiscal discipline under new CEO Lip-Bu Tan, who has indicated that significant changes are forthcoming.

Short-term investors might remain cautious due to Intel’s persistent fundamental weaknesses and less-than-encouraging technical indicators. However, should the earnings report demonstrate signs of stabilization or reveal more details about the restructuring, it could offer a much-anticipated catalyst for bullish traders.

Ratings & Consensus Estimates: Currently, analysts rate Intel stock as Neutral, with an average price target set at $25. Notably, recent projections from Wedbush, Bernstein, and Barclays suggest a mean price target of $19.67 per share, indicating a potential downside of 7.12%.

INTC Stock Price Action: At the time of this publication on Thursday, Intel stock was trading up 3.45% at $21.30.

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Photo: Courtesy Intel