Is Intel (INTC) Stock Undervalued Right Now?

Zacks Equity Research
·3 min read

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company to watch right now is Intel (INTC). INTC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 12.70, while its industry has an average P/E of 21.78. INTC's Forward P/E has been as high as 13.31 and as low as 8.93, with a median of 11.03, all within the past year.

We also note that INTC holds a PEG ratio of 1.69. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. INTC's PEG compares to its industry's average PEG of 2.63. INTC's PEG has been as high as 1.78 and as low as 1.19, with a median of 1.47, all within the past year.

We should also highlight that INTC has a P/B ratio of 3.17. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 5.48. Over the past 12 months, INTC's P/B has been as high as 3.57 and as low as 2.42, with a median of 2.89.

Finally, investors should note that INTC has a P/CF ratio of 7.85. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 12.03. Over the past year, INTC's P/CF has been as high as 8.47 and as low as 5.44, with a median of 6.86.

Value investors will likely look at more than just these metrics, but the above data helps show that Intel is likely undervalued currently. And when considering the strength of its earnings outlook, INTC sticks out at as one of the market's strongest value stocks.


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