Intel Plunges 29%, Worst Day Since the 1970s, Erasing $12B From US Government Stake
INTC sits 97% above its 52-week low of $32.89 on elevated volume (4.2× avg).
Summary
Intel closed down 29% Friday, its worst single day since the 1970s, after Thursday's Q4 guide badly missed: adjusted EPS of 25 cents on revenue of $15-16 billion versus consensus of 43 cents and $17.1 billion. The sell-off wiped about $12 billion off the US government's 10% stake, and Nvidia lost roughly $6 billion on its position. Two problems drove the guide — a PC market squeezed by soaring memory and component prices, with CFO David Zinsner saying the slowdown lasts at least through the first half of next year, and an explosion at the Israel fab that killed two workers and will cost about $600 million in revenue over two quarters. DA Davidson cut the stock to neutral from buy, arguing the multiple is hard to justify with weakness this significant. The foundry story is the swing factor: Intel still has no outside customers for 18A, and CEO Lip-Bu Tan said a couple of customers would be announced in the next two quarters.
At the time of this announcement, INTC was trading at $64.89 on NASDAQ in the Technology sector, with a market capitalization of approximately $347.6B. The 52-week trading range was $32.89 to $142.35. This news item was assessed with negative market sentiment and an importance score of 8 out of 10. Source: CNBC TV18.