KeyBanc analyst John Vinh reiterated a Sector Weight on Intel CorpINTCand a $30 price target.
Vinh hosted an investor meeting with Intel and greatly appreciated the recently announced cost reductions, including $3 billion in 2023 and $5 billion in 2025.
While he was concerned that this represented a shift in strategy and could put critical initiatives such as achieving five nodes in 4 years and IFS at risk, it’s clear these areas will not be materially impacted by cost-cutting.
These cost initiatives appear to be driven by the broader deteriorating macro environment and a more pragmatic approach to retooling its foundry business to be more competitive, ultimately necessary for INTC to succeed as a service foundry.
However, he still thinks it’s early and remains skeptical of INTC’s chances of turning things around in IDM and succeeding as a service foundry.
He sought more proof points before revisiting his Sector Weight thesis.
Price Action: INTC shares closed lower by 0.46% at $28.31 on Tuesday.
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