INTC Stock Report

2-Year Price History

View Larger INTC Chart

Ockham's Rating

INTC Revenue

For a long time, value investors have used the current share price relative to sales per share levels as an important valuation tool. We utilize a historical weighted average methodology that treats recent years more importantly in the calculation. When looking at INTC through this framework, we can see that our weighted average historical high and low Price to Sales per share ratios over the last 10 years are 5.58x and 2.97x respectively.

Utilizing this range we can see that INTC’s current Price to Sales per share ratio of 2.26x is significantly below its average levels historically. In fact, with a current price of $16.72, INTC is a full 48% below its average Price to Sales ratio at comparable sales levels. This is a rare occurrence and, when taken in context of the other areas of our analysis, can be a strong positive for our outlook for INTC.

INTC Cash Earnings

As a value investment framework, Ockham Research is similar to a private equity firm in terms of our valuation methods. We are always on the lookout for value in the form of sales and cash numbers. In the case of INTC, Ockham views their current Cash Earnings as significantly below their historical average multiples of Cash Earnings, as calculated by our proprietary analysis. It is incredibly important to understand that for INTC, the current level of Cash Earnings compared to its historical levels helps identify where INTC is in relation to what the investing community was willing to pay for this level of Cash Earnings in the past. With a historical high Cash Earnings per share ratio of 17.61 and a historical low Cash Earnings per share ratio of 9.40, an investor can relate where value becomes optimal.

So what does "significantly below" mean when we talk about Price to Cash Earnings numbers for INTC? From the Ockham perspective, we are looking specifically at INTC to see if the market is recognizing the huge disparity between INTC's past stock price to Cash Earnings ratio to today's levels. At a difference of 25% below the average historical Price to Cash Earnings ratio, our view would be quite positive at this point. However, as with all metrics, we need to also take other factors into account when looking at INTC. While we view better Cash Earnings metrics as very important, if the market is slow to identify this value, or if Cash Earnings were to fall from these levels, we would become more neutral in our stance.

INTC Dividends

A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely.

When reviewing dividend yields for INTC, we compare the historic high and low levels over the past, which is similar to our evaluation of Sales and Cash Earnings per share. Paying a dividend is not necessary for any company, but changes in dividend often can lend clues as to the health of the business. A rising dividend is a strong sign for an established company, as it reflects management's confidence in the company. INTC’s estimated annual dividend is $0.56 resulting in a current dividend yield of 3.35%. The highest dividend yield from INTC over recent history was 4.65% while the lowest dividend yield was 0.09%. It's hard not to notice that INTC pays a current dividend yield that is 41.35% above the historical median. This peaks our interest since our analysis is looks favorably upon dividend yields that are greater than the historical median.