UBS raises Intel target price to US$65 but keeps Neutral: short-term guidance has upside bias, while long-term EPS upside remains limited

Overview

This is a UBS company research and first-quarter earnings preview report on Intel Corporation (INTC.US). The report argues that Intel’s first-quarter revenue and subsequent guidance have a clear upside bias, driven by PC demand that is more resilient than expected, improving server CPU demand, and potential pricing benefits. At the same time, it emphasizes that the stock has risen about 38% over the past month, and the share price of roughly US$62 is already close to UBS’s revised US$65 target price, so the Neutral rating is maintained.

Core views

The core view is that near-term fundamentals and news flow are constructive, but medium- to long-term earnings power is still insufficient to justify a meaningfully higher valuation. UBS expects FQ1:26E revenue of about US$12.5B, above the prior guidance midpoint of US$12.2B, and also raises its CY26/27/28E revenue and EPS forecasts. Client business remains resilient in the first half, but full-year PC shipments are still expected to decline 5% YoY, with the comparison becoming tougher in the second half, especially in 3Q26. Rebounding server CPU demand, a higher share of enterprise servers, and price increases all help revenue. On Foundry, progress on 14A, potential customer commitments, the Google GCP custom IPU opportunity, Terafab-related cooperation, and the SambaNova partnership all improve the narrative, but most of these are still longer term or sentiment-driven.

Analysis framework

The report combines an earnings preview, segment operating forecasts, peer valuation comparisons, and an SOTP valuation. UBS separately values Intel Products, Intel Foundry, Altera, Mobileye, and All Other businesses, and derives the target price using Intel product EV/EBIT multiples, wafer capacity EV-per-capacity methods, non-controlling interests, and net debt. It also evaluates the valuation range through upside, base, and downside scenarios.

Methodology notes

• Valuation methodsSOTP sum-of-the-parts valuation

  Value Intel’s different businesses separately and then add them together

  UBS values Intel Products, Intel Foundry, Altera, Mobileye, and other businesses separately, then adjusts for the Brookfield SCIP-related non-controlling interest impact and includes net debt and other items to derive the target price.

• Valuation methodsEV/EBIT multiple

  Value the product business based on an operating profit multiple

  The report values Intel’s product business at 19x EV/EBIT, up from the prior 15x, based on the historical median of adjusted multiples for peers such as AMD and NVDA.

• Valuation methodsEV per capacity

  Value manufacturing assets based on installed wafer capacity

  Intel Foundry manufacturing assets are valued on a per-unit wafer-capacity enterprise value basis, with reference to global foundries and TSMC, and a 45% discount is applied to reflect node, yield, customer stickiness, and utilization risks.

• Scenario AnalysisUpside/base/downside scenarios

  Target-price range sensitivity

  The report lays out an upside scenario of US$79, a base case of US$65, and a downside case of US$49, driven mainly by product revenue growth, normalized EBIT margins, and wafer-capacity valuation parameters.

• Earnings Power AnalysisBlue Sky EPS Power

  2030 blue-sky scenario EPS power

  Even assuming healthy product growth, Foundry revenue reaching US$15B, a significant improvement in gross margin, and lower Brookfield SCIP-related NCI impact, UBS still sees 2030 EPS power at about US$3.18, with annualized EPS roughly no higher than US$3.00-3.50.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Intel Corporation (INTC.US)

  Core coverage name

  Strengths

  Short-term resilience in PC demand, improving server CPU demand, potential ~10% price increases, an improving Foundry narrative, and 14A PDK plus potential customer commitments can all act as catalysts.

  Weaknesses

  The share price has already rebounded sharply, leaving limited target-price upside; long-term EPS power is still constrained by product competition, Foundry losses, yield, and capital structure.

  Comparison

  At roughly US$62, Intel’s current share price implies about 20x C2030 blue-sky P/E, close to AMD’s 22x C2027 P/E and 17x C2028 P/E, suggesting that Intel’s valuation already reflects a substantial amount of improvement.

  Risks

  PC demand may weaken in the second half, AMD/NVDA competition, slow Foundry customer wins, 14A progress or yield shortfalls, and unfavorable Brookfield SCIP/NCI treatment.

• Advanced Micro Devices Inc (AMD.US)

  Main competitor and valuation benchmark

  Strengths

  Continues to pressure Intel in client and server CPU markets; its P/E multiple is used as a comparison for Intel’s valuation reasonableness.

  Weaknesses

  The report does not discuss AMD’s own fundamentals in detail; it is used mainly as a risk and valuation benchmark for Intel.

  Comparison

  Intel’s current share price is equivalent to about 20x C2030 blue-sky P/E, close to AMD’s 22x C2027 P/E, which reduces Intel’s room for further valuation expansion.

  Risks

  AMD’s new CPU products could continue to erode Intel’s client and server share.

• Brookfield Corp (BN.US)

  Counterparty related to Intel SCIP/NCI structure

  Strengths

  The SCIP arrangement provides a funding structure for part of Intel’s manufacturing investment.

  Weaknesses

  The related non-controlling interest is treated roughly like debt in the valuation, reducing Intel’s equity value.

  Comparison

  The report discusses Intel potentially writing a US$25-30B check to eliminate the Brookfield SCIP and related NCI impact.

  Risks

  If the refinancing or removal of NCI is costly, it may limit the release of Intel shareholder value.

• Intel Foundry

  Source of long-term re-rating and sentiment catalyst

  Strengths

  14A progress, potential Google/AAPL/AMD/NVDA customer commitments, the imagination around Terafab cooperation, and custom ASIC/XPU opportunities all improve the narrative.

  Weaknesses

  Near-term financial contribution is limited, equipment delivery cycles are long, and gross margins still need significant repair from deep losses.

  Comparison

  UBS benchmarks Foundry against global foundries and TSMC on a capacity-based valuation basis, then applies a 45% discount to reflect the gap.

  Risks

  Node progress, yield, customer stickiness, utilization, and the realization of customer commitments all remain uncertain.

Key data

• 12-month target priceUS$65.00Prior US$51.00, raised based on the SOTP valuation framework.
• Current share priceUS$62.38Price on 2026-04-10.
• 12-month ratingNeutralThe report maintains a Neutral rating.
• FQ1:26E revenueAbout US$12.5BAbove the prior guidance midpoint of US$12.2B.
• FQ1:26E EPSAbout US$0.06Broadly unchanged.
• CY26/27/28E revenue forecastUS$53.1B / US$55.1B / US$58.5BPreviously US$51.1B / US$52.4B / US$56.1B.
• CY26/27/28E EPS forecastUS$0.44 / US$0.75 / US$1.05Previously US$0.35 / US$0.60 / US$0.92.
• CY2026 PC shipment forecastDown 5% YoYUBS’s latest PC model; 3Q26 is expected to be down 10% YoY, creating the greatest pressure.
• Client revenue forecastDown about 10% YoY in CY2026Supply constraints are expected to ease as Panther Lake ramps on 18A.
• 2030 EPS in blue-sky scenarioUS$3.18At the current share price, this implies roughly 20x C2030 P/E.
• Upside/base/downside valuationUS$79 / US$65 / US$49Based on SOTP scenario analysis.
• Google GCP–Intel custom IPU opportunityUS$1B-3B annual revenue per projectCustom IPU opportunity for offloading network, storage, and security functions.

Impact & implications

For investors, the implication is that Intel’s near-term earnings and foundry catalysts could still support the share price, especially before the 14A 1.0 PDK release, when sentiment may remain constructive. But with the stock having already rebounded sharply, limited target-price upside, and long-term EPS power still constrained by product competition, foundry yield, and capital intensity, the risk-reward now looks closer to balanced. The report is more optimistic on near-term revenue and guidance, but it does not turn decisively bullish.

Risks

• The share price has risen about 38% over the past month, so some near-term positives may already be reflected.
• PC demand may see a more pronounced correction in the second half, with 3Q26 facing the toughest YoY comparison.
• The Client business remains affected by supply constraints, and Panther Lake’s ramp on 18A needs to be validated.
• AMD’s new products in client and server CPUs could continue to pressure Intel’s share and pricing power.
• NVDA’s moat in high-intensity data-center computing workloads may more broadly substitute for Intel-related demand.
• There is uncertainty around Foundry customer commitments, 14A PDK adoption, yield improvement, and utilization gains.
• The Terafab partnership has not disclosed a formal transaction structure, and equipment delivery cycles are long, so meaningful financial contribution is unlikely before 2029.
• Brookfield SCIP-related non-controlling interests or refinancing arrangements may continue to weigh on Intel’s equity value.
• Even in the blue-sky scenario, 2030 EPS power may still be only about US$3.00-3.50, limiting valuation upside.

What to watch

• Whether actual FQ1:26 revenue reaches or exceeds about US$12.5B, and whether the next-quarter revenue guide is above market expectations.
• Whether the improvement in server CPU demand continues, and whether the roughly 10% price increase can be smoothly converted into revenue and profit.
• Whether PC shipments in 2H26 correct more meaningfully as UBS expects, especially the YoY decline in 3Q26.
• The pace of Panther Lake’s ramp on 18A and the speed at which Client supply constraints ease.
• The timing of the 14A 1.0 PDK release, customer trial feedback, and whether potential foundry commitments from Google, AAPL, AMD, and NVDA actually materialize.
• Whether the Intel-Terafab cooperation develops a formal transaction structure, capital expenditure sharing, and a capacity timeline.
• Whether the Google GCP–Intel custom IPU and SambaNova–Intel partnerships generate quantifiable revenue opportunities.
• Whether Brookfield SCIP-related NCI is reduced through refinancing or other means, lessening the drag on shareholder value.