Is it too late to sell Intel stock as shares plunge after FQ3 revenue miss?

By: Motiur Rahman
Motiur Rahman
Md Motiur enjoys researching how companies are solving challenges the world will face over the coming decades. In his… read more.
on Oct 22, 2021
  • Intel shares plummeted more than 10% on Friday after announcing its most recent quarterly results.
  • The company reported its FQ3 results Thursday after markets closed, missing revenue estimates.
  • However, its FQ3 EPS and full-year 2021 EPS guidance came in ahead of expectations.

On Friday, Intel Corporation (NASDAQ:INTC) shares plummeted more than 10% following Thursday’s disappointing revenue miss. The company reported its fiscal Q3 results after markets closed, beating earnings expectations. Intel also raised its FY2021 earnings expectations, significantly surpassing Street forecasts.

The company posted non-GAAP earnings per share of $1.71, beating the consensus for analyst expectations of $1.11. In addition, Intel’s GAAP EPS of $1.67 was $0.61 ahead of Street estimates, while revenue for the quarter of $18.1 billion, fell short of expectations by $170 million after recording a marginal increment of 4.6%.

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The company raised its FY2021 non-GAAP EPS to $5.28 from $4.80, ahead of the average Street forecast of $4.11. Intel expects FQ4 revenue of about $8.3 billion, slightly ahead of the consensus of $8.26 billion, while its earnings forecast for the quarter of $0.90 is below the average estimate of $0.94.

Intel looks undervalued

From an investment perspective, Intel shares trade at an exciting P/E ratio of about 11.10, making it a compelling option for value investors.

Moreover, analysts expect the computing software provider’s earnings per share to grow at an average annual rate of about 10% over the next five years. In addition, INTC trades at a forward dividend yield of 2.78%.

Therefore, the stock could also gain the attention of both dividend and growth investors. 

Source – TradingView

Technically, Intel shares spiked on Thursday to surge above the descending channel formation. However, Friday’s plunge pushed the stock back within the channel, falling to restest the trendline support.

Therefore, investors could target potential rebound profits at about $51.85, or higher at $53.74, while $48.08 and $46.07 are crucial support zones.

Time to target a rebound?

In summary, following Intel stock’s massive decline of more than 10% on Friday, it may be too late to sell the stock. 

Therefore, given the company’s compelling valuation multiples, it may be best to target potential short-term rebounds or wait for a retest of the resistance levels before cashing out.

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