Intel Corp. shares surged nearly +3% Friday, following an upgrade by Morgan Stanley.
Morgan Stanley analyst Joseph Moore mentioned in a note to clients that he was revising rating on Intel to overweight from equal weight. He also raised price target for Intel stock to $64 a share from $55 a share, while expressing optimism about the chipmaker’s interim CEO Bob Swan, referring to him as “a more financially oriented CEO”.
Swan took over the role of CEO around January-end, following the June 2018 resignation of Brian Krzanich. According to Intel, Krzanich violated Intel's non-fraternization policy. Swan, 58, had served as chief financial officer at eBay Inc. for nine years, before joining Intel in 2016.
With regards to the rating upgrade, Moore also appreciated what he felt was Intel’s increased focus on free cash flow over earnings, alongwith better M&A accretion. Moore said, "we see the multiple expanding from 12x to 14x in our base case.”