Is Intel a Buy With This New Chip on the Market?

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With shares of Intel (NASDAQ:INTC) trading between $20 and $21.50 for the past month, is INTC a BUY, a WAIT and SEE, or a STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock’s Movement:

With steadily increasing tablet sales making the predictions for the end of the PC-era a reality, one analyst after another has lowered price targets for the semiconductor manufacturer. On December 20, Evercore Partners analyst Patrick Wang cut estimates on Intel, Advanced Micro Devices (NYSE:AMD) and Nvidia (NASDAQ:NVDA), citing continuing soft demand for personal computers and on November 29, analysts at Citigroup dropped their target to $21 and Goldman Sachs analysts slashed their target to $16.

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But Wells Fargo analyst David Wong has predicted a different future. On Monday, he placed the company’s valuation range between $28 and $33 per share, reiterated an Outperform rating, and called the stock his top pick.

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“We think secular themes such as cloud computing and data traffic created by mobile computing (notebooks, tablets and smartphones) could drive x-86 server-related processor growth in the mid-teens percentage range over the next several years,” Wong wrote in a research note seen by Barron’s, “the server processor market has grown from below $2 billion in 2002 to a run rate of the order of $10 billion a year in 2012.”

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