Intel Earnings: Turning the Corner in PCs, but Much Work Still To Be Done; Shares Fairly Valued

Narrow-moat Intel reported second-quarter results and provided investors with a third-quarter outlook that, while still ugly, were better than expected and which we view as a bottom for the company, as the PC inventory correction appears to be winding down. We’re also encouraged that Intel’s various manufacturing advancements, such as Meteor Lake’s arrival in the fourth quarter, are still on track, as we think it is critical for Intel to achieve its aggressive target of five node transitions in four years. We maintain our $35 fair value estimate and view shares as fairly valued.