In the ever-changing and fiercely competitive business landscape, conducting thorough company analysis is crucial for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating Intel (NASDAQ:INTC) and its primary competitors in the Semiconductors & Semiconductor Equipment industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company’s performance within the industry.
Intel Background
Intel is a leading digital chipmaker, focused on the design and manufacturing of microprocessors for the global personal computer and data center markets. Intel pioneered the x86 architecture for microprocessors and led the semiconductor industry down the path of Moore’s law for advances in semiconductor manufacturing. Intel remains the market share leader in central processing units in both the PC and server end markets. Intel is seeking to reinvigorate its chip manufacturing business, Intel Foundry, while developing leading-edge products within its Intel Products business segment.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Intel Corp | 782.67 | 2.11 | 3.87 | 3.98% | $7.85 | $5.22 | 2.78% |
| NVIDIA Corp | 46.10 | 38.07 | 24.46 | 29.14% | $38.75 | $41.85 | 62.49% |
| Broadcom Inc | 73.73 | 20.51 | 26.72 | 11.02% | $9.86 | $12.25 | 28.18% |
| Micron Technology Inc | 34.48 | 6.94 | 9.68 | 9.28% | $8.35 | $7.65 | 56.65% |
| Advanced Micro Devices Inc | 121.38 | 6.21 | 11.82 | 2.06% | $2.11 | $4.78 | 35.59% |
| Texas Instruments Inc | 34.90 | 10.47 | 10.16 | 8.21% | $2.24 | $2.72 | 14.24% |
| Qualcomm Inc | 31.82 | 8.05 | 3.98 | -12.88% | $3.51 | $6.24 | 10.03% |
| Analog Devices Inc | 65.84 | 4.35 | 13.53 | 2.32% | $1.47 | $1.94 | 25.91% |
| ARM Holdings PLC | 135.62 | 15.15 | 25.56 | 3.3% | $0.22 | $1.11 | 34.48% |
| Marvell Technology Inc | 28.33 | 4.85 | 8.97 | 13.84% | $2.58 | $1.07 | 36.83% |
| NXP Semiconductors NV | 29.31 | 5.94 | 5.02 | 6.43% | $1.11 | $1.79 | -2.37% |
| Monolithic Power Systems Inc | 26.51 | 13.87 | 18.69 | 5.12% | $0.21 | $0.41 | 18.88% |
| ASE Technology Holding Co Ltd | 39.56 | 4.22 | 2.15 | 3.56% | $32.4 | $28.88 | 5.29% |
| First Solar Inc | 18.71 | 2.90 | 5.19 | 5.19% | $0.61 | $0.61 | 79.67% |
| Credo Technology Group Holding Ltd | 130.15 | 21.20 | 36.22 | 7.99% | $0.09 | $0.18 | 272.08% |
| ON Semiconductor Corp | 82.64 | 3.07 | 4.08 | 3.22% | $0.44 | $0.59 | -11.98% |
| STMicroelectronics NV | 48.33 | 1.39 | 2.21 | 1.33% | $0.31 | $1.06 | -1.97% |
| United Microelectronics Corp | 17.39 | 2.05 | 3.08 | 4.29% | $30.07 | $17.62 | -2.25% |
| Tower Semiconductor Ltd | 75.05 | 5.13 | 9.72 | 1.9% | $0.13 | $0.09 | 6.79% |
| Rambus Inc | 51.42 | 9.02 | 17.31 | 3.84% | $0.08 | $0.14 | 22.68% |
| Lattice Semiconductor Corp | 416.10 | 16.11 | 23.23 | 0.4% | $0.01 | $0.09 | 4.92% |
| Average | 75.37 | 9.97 | 13.09 | 5.48% | $6.73 | $6.55 | 34.81% |
Through a meticulous analysis of Intel, we can observe the following trends:
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At 782.67, the stock’s Price to Earnings ratio significantly exceeds the industry average by 10.38x, suggesting a premium valuation relative to industry peers.
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With a Price to Book ratio of 2.11, significantly falling below the industry average by 0.21x, it suggests undervaluation and the possibility of untapped growth prospects.
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The Price to Sales ratio is 3.87, which is 0.3x the industry average. This suggests a possible undervaluation based on sales performance.
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The company has a lower Return on Equity (ROE) of 3.98%, which is 1.5% below the industry average. This indicates potential inefficiency in utilizing equity to generate profits, which could be attributed to various factors.
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The company exhibits higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $7.85 Billion, which is 1.17x above the industry average, implying stronger profitability and robust cash flow generation.
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With lower gross profit of $5.22 Billion, which indicates 0.8x below the industry average, the company may experience lower revenue after accounting for production costs.
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The company’s revenue growth of 2.78% is significantly lower compared to the industry average of 34.81%. This indicates a potential fall in the company’s sales performance.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is a key indicator of a company’s financial health and its reliance on debt financing.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company’s financial health and risk profile, aiding in informed decision-making.
In terms of the Debt-to-Equity ratio, Intel stands in comparison with its top 4 peers, leading to the following comparisons:
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Intel exhibits a stronger financial position compared to its top 4 peers in the sector, as indicated by its lower debt-to-equity ratio of 0.44.
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This suggests that the company has a more favorable balance between debt and equity, which can be seen as a positive aspect for investors.
Key Takeaways
The high PE ratio of Intel suggests that the company may be overvalued compared to its peers in the Semiconductors & Semiconductor Equipment industry. On the other hand, Intel’s low PB and PS ratios indicate that the stock may be undervalued based on its book value and sales. In terms of ROE, Intel’s performance is lagging behind its industry peers, while its high EBITDA implies strong operational earnings. The low gross profit and revenue growth of Intel indicate potential challenges in generating profits and expanding its business compared to industry competitors.
This article was generated by Benzinga’s automated content engine and reviewed by an editor.
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