-- Intel (INTC) posted solid Q1 results, but the company's recovery is well-priced into the stock, and the foundry segment must prove to external clients amid diversification away from Taiwan Semiconductor Manufacturing (TSM), BofA Securities said in a Friday research report.
Limited memory supply is a challenge to server hardware shipments, while new foundry deal wins will need more capex, pushing out breakeven beyond the end of 2027, according to the note.
The brokerage said it raised its 2026, 2027, and 2028 EPS forecast to $1.04, 1.58, and $2.25, respectively, from $0.63, $1.14, and $1.50 earlier.
Despite near-term benefits from rising demand for server central processing units, rival Advanced Micro Devices (AMD) likely has a better x86 server CPU product, analysts wrote.
The brokerage said it reiterated its underperform rating on the stock and adjusted its price target to $56 per share from $48.
Price: $82.20, Change: $+15.42, Percent Change: +23.09%