Is Intel a Value Stock or a Value Trap for 2023?
Intel (NASDAQ: INTC) could not have kicked off 2023 in worse fashion. Its fourth-quarter 2022 earnings were near the bottom of the already not-great guidance it had provided a few months ago, and the first quarter of 2023 is going to be even uglier. Intel has a very difficult and expensive uphill battle ahead of it as it tries to catch up to its peers on multiple fronts.
By some metrics, Intel may actually appear like an incredible value at this point. Indeed, the stock price hasn't been this low in years and trades for less than 1.7 times trailing-12-month sales -- a meager metric that semiconductor stocks rarely trade for. But there are good reasons for the pessimism a would-be value hunter should be aware of, because Intel could very well be a value trap (a stock that looks cheap but isn't).
Intel's Q4 2022 revenue and non-GAAP (adjusted) earnings per share (EPS) fell a respective 32% and 92% compared to a year ago. Things will get worse before they get better. Revenue, at the midpoint of guidance, will fall another 40% year over year in the first quarter of 2023. Adjusted EPS will swing to negative $0.15, compared to positive $0.87 in Q1 2022.
Source Fool.com
