Intel Price Target Raised to $41 at Mizuho After Strong Quarter

Mizuho lifted its price target for Intel (INTC, Financials) to $41 from $39 following the chipmaker's stronger-than-expected September quarter and continued progress on its 18A manufacturing yields. The company kept its Neutral rating since margins were still hurting, even if the fundamentals were getting better.

Intel's sales in the third quarter were $13.7 billion, which was higher than the $13.13 billion that most people believed they would be. Earnings per share were $0.23, which was greater than the $0.01 that most people imagined they would be.

People thought that the company's sales for the December quarter would be around $13.3 billion, and that's what they claimed it would be. They also indicated that the gross margin will go down by 350 basis points to 36.5% because of changes in the product mix and the loss of the Altera business.

Intel shares have risen 72% over the past six months, trading near a 52-week high of $39.65. The company's 18A process technology is progressing as planned, with management expecting yields to reach target levels by late 2026.

The chipmaker is also moving to streamline operations, cutting approximately 13,000 positions and targeting operating expenses between $16 billion and $17 billion for fiscal 2025.

Capital expenditures remain set at $18 billion. Mizuho said these steps demonstrate meaningful cost control and balance sheet improvement, supported by debt reduction and funding from the U.S. government, SoftBank, and asset sales.