Latest news with #JoshuaBuchalter
CTV News
4 days ago
- Business
- CTV News
Intel slumps as potential foundry exit deepens investor gloom
Intel shares sank eight per cent on Friday after the company warned of exiting chip manufacturing if it fails to secure a major customer, a potentially drastic move by the new CEO to cut spending and revive the struggling American icon. Lip-Bu Tan said on Thursday he would further shrink Intel's workforce, halt work on two plants in Europe and slow another in Ohio, binning his ousted predecessor's strategy that relied on building costly facilities to restore its manufacturing edge. The plan for such extreme measures follows a surprise second-quarter adjusted loss and a forecast for a bigger-than-expected loss in the third quarter. The weakening financials pointed to more trouble for Intel after years of mismanagement eroded its PC and datacenter market share and left it with almost no presence in the AI market. The disclosures 'revive long-unanswered questions on the chances of success for its foundry business the path forward is if Intel does not develop leading edge manufacturing capability,' TD Cowen analyst Joshua Buchalter said. 'It's hard to understate the significance of this potential outcome in the context of the history of the semiconductor industry.' As part of its new strategy, Intel may reserve the advanced 18A manufacturing process for its products and proceed with its next-generation 14A only if it lands a major external customer commits, Tan told analysts on the post-earnings call. The move could put US$100 billion in assets at risk and deepen its dependence on rival TSMC, adding strain to margins already running at about half their historical highs. 'Intel Foundry is a big story and currently people are questioning how successful 18A is. A failure in 18A will be a broken story,' said Hendi Susanto, portfolio manager at Gabelli Funds. Intel was set to lose nearly $8 billion in market value, if current losses hold. Its current valuation of around $100 billion is less than half of Advanced Micro Devices' AMD.O more than $260 billion. The stock has lagged far behind rivals this year, rising 12.8 per cent compared with AI darling Nvidia's 30 per cent gain and AMD's 34 per cent. Intel trades at a 12-month forward price-to-earnings ratio of 42.55 versus 33.90 for Nvidia and 32.12 for AMD. Since taking the helm in March, Tan has divested businesses, laid off employees and redirected resources as part of his strategic reset to revive the embattled chipmaker. 'There are no more blank checks,' he wrote in a memo to employees on Thursday. (Reporting by Rashika Singh and Arsheeya Bajwa in Bengaluru, Samuel Indyk in London; Editing by Amanda Cooper, Vijay Kishore and Arun Koyyur)
Reuters
4 days ago
- Business
- Reuters
Intel slumps as potential foundry exit deepens investor gloom
July 25 (Reuters) - Intel shares (INTC.O), opens new tab sank 8% on Friday after the company warned of exiting chip manufacturing if it fails to secure a major customer, a potentially drastic move by the new CEO to cut spending and revive the struggling American icon. Lip-Bu Tan said on Thursday he would further shrink Intel's workforce, halt work on two plants in Europe and slow another in Ohio, binning his ousted predecessor's strategy that relied on building costly facilities to restore its manufacturing edge. The plan for such extreme measures follows a surprise second-quarter adjusted loss and a forecast for a bigger-than-expected loss in the third quarter. The weakening financials pointed to more trouble for Intel after years of mismanagement eroded its PC and datacenter market share and left it with almost no presence in the AI market. The disclosures "revive long-unanswered questions on the chances of success for its foundry business the path forward is if Intel does not develop leading edge manufacturing capability," TD Cowen analyst Joshua Buchalter said. "It's hard to understate the significance of this potential outcome in the context of the history of the semiconductor industry." As part of its new strategy, Intel may reserve the advanced 18A manufacturing process for its products and proceed with its next-generation 14A only if it lands a major external customer commits, Tan told analysts on the post-earnings call. The move could put $100 billion in assets at risk and deepen its dependence on rival TSMC ( opens new tab, adding strain to margins already running at about half their historical highs. "Intel Foundry is a big story and currently people are questioning how successful 18A is. A failure in 18A will be a broken story," said Hendi Susanto, portfolio manager at Gabelli Funds. Intel was set to lose nearly $8 billion in market value, if current losses hold. Its current valuation of around $100 billion is less than half of Advanced Micro Devices' (AMD.O), opens new tab more than $260 billion. The stock has lagged far behind rivals this year, rising 12.8% compared with AI darling Nvidia's (NVDA.O), opens new tab 30% gain and AMD's 34%. Intel trades at a 12-month forward price-to-earnings ratio of 42.55 versus 33.90 for Nvidia and 32.12 for AMD. Since taking the helm in March, Tan has divested businesses, laid off employees and redirected resources as part of his strategic reset to revive the embattled chipmaker. "There are no more blank checks," he wrote in a memo to employees on Thursday.
CNA
4 days ago
- Business
- CNA
Intel slumps as potential foundry exit deepens investor gloom
Intel shares sank 8 per cent on Friday after the company warned of exiting chip manufacturing if it fails to secure a major customer, a potentially drastic move by the new CEO to cut spending and revive the struggling American icon. Lip-Bu Tan said on Thursday he would further shrink Intel's workforce, halt work on two plants in Europe and slow another in Ohio, binning his ousted predecessor's strategy that relied on building costly facilities to restore its manufacturing edge. The plan for such extreme measures follows a surprise second-quarter adjusted loss and a forecast for a bigger-than-expected loss in the third quarter. The weakening financials pointed to more trouble for Intel after years of mismanagement eroded its PC and datacenter market share and left it with almost no presence in the AI market. The disclosures "revive long-unanswered questions on the chances of success for its foundry business the path forward is if Intel does not develop leading edge manufacturing capability," TD Cowen analyst Joshua Buchalter said. "It's hard to understate the significance of this potential outcome in the context of the history of the semiconductor industry." As part of its new strategy, Intel may reserve the advanced 18A manufacturing process for its products and proceed with its next-generation 14A only if it lands a major external customer commits, Tan told analysts on the post-earnings call. The move could put $100 billion in assets at risk and deepen its dependence on rival TSMC, adding strain to margins already running at about half their historical highs. "Intel Foundry is a big story and currently people are questioning how successful 18A is. A failure in 18A will be a broken story," said Hendi Susanto, portfolio manager at Gabelli Funds. Intel was set to lose nearly $8 billion in market value, if current losses hold. Its current valuation of around $100 billion is less than half of Advanced Micro Devices' more than $260 billion. The stock has lagged far behind rivals this year, rising 12.8 per cent compared with AI darling Nvidia's 30 per cent gain and AMD's 34 per cent. Intel trades at a 12-month forward price-to-earnings ratio of 42.55 versus 33.90 for Nvidia and 32.12 for AMD. Since taking the helm in March, Tan has divested businesses, laid off employees and redirected resources as part of his strategic reset to revive the embattled chipmaker.
Business Insider
13-07-2025
- Business
- Business Insider
TD Cowen Upgrades Texas Instruments (TXN) Stock to Buy with $245 Target — Wall Street Split on Valuation
Texas Instruments (TXN) has been on a strong run lately. Shares are up nearly 47% over the past three months and have gained almost 20% year-to-date, handily beating both the S&P 500 (SPY) and even Nvidia (NVDA) over the same stretch. At $221.25, the stock is trading near its 52-week high, but Wall Street remains divided on whether there is more upside ahead. Nonetheless, Goldman Sachs, Citi, and KeyBanc all issued Buy ratings in the last week. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. Analysts Split as Texas Instruments Rallies Toward Recovery TD Cowen stands out on the bullish side. Four-star Analyst Joshua Buchalter upgraded TXN stock to Buy from Hold and raised his price target to $245 from $200. That suggests about 11% upside. He sees early signs that industrial semiconductor de-stocking is nearing an end and believes Texas Instruments is well-positioned to benefit from a recovery. The company's U.S.-based 300mm fabs, streamlined product portfolio, and high utilization rates give it operating leverage as demand improves. Buchalter expects capital spending to reach $2.5 billion next year and believes free cash flow per share could more than double by 2026. Despite those positives, others are staying on the sidelines. Many analysts still view TXN as fairly valued, with tariff uncertainty and slowing macro trends in focus. Hedge funds reduced their holdings by 1.9 million shares last quarter, and insider transactions show more selling than buying over the past three months. Even so, the fundamentals remain solid. Return on equity is 29.04% over the trailing 12 months, and the dividend yield is 2.48%. Momentum is also strong, with a 13.87% gain over the past year and technical indicators showing a positive trend. With earnings coming up on July 22, the next update may shape how long this rally can last. For now, TXN sits at the intersection of cautious optimism and improving chip industry signals. Whether that's enough to drive the next leg higher remains to be seen. Is TXN a Good Stock to Buy? Out of 26 analysts who updated their price targets over the past three months, 13 have a Buy rating, 10 recommend Hold, and 3 rate the stock Sell, culminating in a Moderate Buy consensus. The average 12-month TXN stock price target sits at $198.27, implying a 10% downside from current levels.
CNBC
11-07-2025
- Business
- CNBC
This chip stock is outperforming and will continue going higher, TD Cowen says
Shares of Texas Instruments could be set up for more gains as the semiconductor industry backdrop improves, TD Cowen said. In a note dated Thursday, the firm upgraded the chip stock to buy from hold and hiked its price target to $245 from $200 — which implies more than 11% upside. "With more confidence the industrial semis de-stocking is ending, and flexible CapEx in 2026+, we raise our estimates and upgrade shares of TI to Buy with a $245 PT," analyst Joshua Buchalter wrote. "Tariff/ macro concerns linger, but we see TI positioned to outperform in either a sharp or gradual recovery." Texas Instruments has surged nearly 49% in the past three months, outpacing both the S & P 500 and artificial intelligence chip darling Nvidia in that timeframe. Shares have also more than doubled the broader market's gains in 2025, rising more than 17% year to date compared to the S & P 500's almost 7% jump. TXN NVDA 3M mountain TXN vs. NVDA, 3-month Though Buchalter noted that President Donald Trump's tariffs linger , which could lead to some demand constraints, he thinks that "inventory dynamics are the bigger swing factor for broad-based semis this earnings season." "Given TI's limited use of the channel, we believe the company is at the front of the line to participate in a recovery as consumption more closely matches sell-through, and for any potential end demand recovery," he wrote. "As supply and demand more closely align, we believe TI's cost-accretive US-based 300mm manufacturing footprint, and realigned embedded portfolio, position the company to regain share in key industrial and automotive end markets." Beyond that, Buchalter said the company will generate significant free-cash-flow growth, seeing it more than double in share price by 2026. He also estimates that its capital expenditures will reach $2.5 billion next year. Buchalter's bullish call is in the minority on Wall Street, however. Out of the 39 analysts covering Texas Instruments, only 12 in all have a strong buy or buy rating, according to LSEG, while 23 have stepped to the sidelines with a hold rating. The stock was almost 1% higher in the premarket on Friday following the upgrade.
