Intel Corporation (NASDAQ:INTC) traded at a 19-year high Friday after it forecasted better-than-expected 2020 earnings, signaling a strong recovery in chip demand. The firm’s fourth-quarter earnings also handily beat analyst estimates.
For the 4Q ending in December, the chipmaker posted earnings of $1.52 per share on revenue of $20.2 billion. The consensus earnings estimate was $1.24 per share on revenue of $19.2 billion. Revenue grew 8.3% on a year-over-year basis.
Revenue at Intel's data center business jumped 19% and sales to cloud computing providers were up 48% in the fourth quarter, compared to the same period a year earlier.
Investors responded well, sending Intel shares nearly 8.1% higher to $68.45.
Intel said it would release nine 10nanometer (nm) products this year and launch its lead 7nm product next year.
“In 2019, we gained share in an expanded addressable market that demands more performance to process, move and store data,” said Intel CEO Bob Swan in a statement.
Intel said it expects first-quarter earnings of approximately $1.30 per share on revenue of approximately $19 billion and 2020 earnings of approximately $5 per share on revenue of approximately $73.50 billion.
The current consensus earnings estimate is $1.05 per share on revenue of $17.24 billion for the quarter ending March 31, 2020 and $4.72 per share on revenue of $72.07 billion for the year ending December 31, 2020.
At least seven brokerages raised their price targets on Intel's stock, with J.P.Morgan making the most aggressive move by boosting its target by $12 to $80, well above the median price target of around $68.
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