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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting
QCOM 174.23-0.6%3:59 PM EST
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To: Bill Wolf who wrote (195282)8/20/2025 6:45:34 AM
From: Bill Wolf  Read Replies (2) of 197014
 
Intel’s earnings collapse
The abrupt rally in Intel shares this month has pushed the beleaguered chip maker’s valuation so high that its most recent precedent is from the tail end of the dot-com era more than two decades ago.

But unlike the during dotcom era, the stock’s price-earnings ratio of 53 is no indicator of euphoria about Intel’s business prospects. Rather, it’s a reflection of the utter collapse in the company’s earnings.




Analysts predict Intel will earn just under $1.1 billion over the next four quarters, after losing about $1.3 billion in the previous four, according to data compiled by Bloomberg. From 2018 to 2021 the company generated more than $20 billion in profits annually.

The average earnings per share estimate for 2025 has been slashed by 88% over the past year.

So when a glimmer of good news — plans by the Trump administration and SoftBank to take stakes in Intel — causes the stock to soar, the valuation soars with it, given how depressed the E part of the PE ratio is. Meanwhile, investors still aren’t sure how the company will regain its technological leadership in chipmaking.

“I think it’s overvalued, but I also think the picture is so uncertain that it wouldn’t be attractive at any price,” said Nancy Tengler of Laffer Tengler Investments. — Ryan Vlastelica
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