Intel (INTC), the world’s largest semiconductor manufacturer with a market capitalization of $ 227 billion, reports its third-quarter earnings after the market close today. Zacks Investment Research’s forecast for the Q3 earnings per share (EPS) should be at $ 1.1, and Zacks’ forecasts for both Q1 and 2 are 13.28% and 10.81% lower than the reported figures, respectively. While revenue is likely to be $ 18.21, down 5% from the same quarter a year ago.
As a result of the Covid-19 crisis, more and more people have to work from home. This is expected to be a good prospect for Intel’s Q3 results, where the interest is now in the data center segment; enterprise laptop and mobile computing driven by the greater adoption of cloud computing, as well by the infrastructure of 5G networks at present.
In addition, Zacks reported that according to IDC, in Q3 the PC segment demand saw a 14.6% increase, or 81.3 million units, as a result of a transit recovery. Meanwhile, in the Q3 of this year, Intel released an 11th generation “Tiger Lake” processor optimized for thin and light laptops. In addition to this, there are also other series processors, the newly released Intel Atom x6000E, the Intel Pentium, as well as the Intel Celeron N and J.
However, there is increasing pressure from its key competitor AMD, who released a cheaper second-generation processor, i.e. EPYC processor. The increase in production costs of the 10nm processor could also hurt Intel’s Q3 revenue.
INTC’s share price this year is down around 10.61% and is now trading at 53.50. This week, the share price could retest the 3-month high at 56.20, if positive momentum has been maintained. The key resistance area is seen at the 56.85 high, at the 200-Day MA, while an immediate support could be seen at 52.70 (20-day MA) and the 51.00 (50-Day MA). Meanwhile, in the picture above you can see a long-term triangular price pattern formation where INTC’s share price should remain stuck in since January 2020.
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Chayut Vachirathanakit
Market Analyst – HF Educational Office – Thailand
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