Intel Downgraded at First Global on Competition and Inventory Concerns (INTC)

Filed in dividend, downgrade, Gold, Gold Investing, Guidance, lead, outperform, shares by on October 19, 2010 0 Comments

Computer processor maker Intel Corporation ( INTC ) on Tuesday caught a downgrade from analysts at First Global, who cited concerns from competition and rising inventory levels. The firm cut its rating on INTC from “Outperform” to “Market Perform,” noting “INTC’s reported numbers for Q3 FY10 came in line with our estimates, though management provided an unexciting and slightly lower than expected guidance for Q4 CY10…There has been growing threat from tablets and smartphones and competition in the consumer business is expected to heat up further in the holiday season…We expect INTC’s start-up costs, as well as costs associated with taking some of its factories offline, to put pressure on the company’s margins…There is increasing concern over a possible inventory pile-up.” Continuing, an analyst said “Moreover, the concerns over softening macroeconomic conditions leading to a further slow down in demand and weakening of consumer spending have intensified.” Intel shares fell 18 cents, or -0.9%, in premarket trading Tuesday. The Bottom Line We had removed shares of INTC from our recommended list back on June 8, 2010, when the stock was trading at $20.31. The company has a 3.28% dividend yield, based on last night’s closing stock price of $19.19. The stock has technical support in the $17 price area. If the shares can firm up, we see overhead resistance around the $21-$22 price levels. We would remain on the sidelines for now. Intel Corporation ( INTC ) is not recommended at this time, holding a DARS™ Rating of 3.4 out of 5 stars. Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

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Intel Downgraded at First Global on Competition and Inventory Concerns (INTC)

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