January 8, 2017 NASDAQ: INTC

INTEL CORP BUY A+

A

A-

HOLD

B+

B

Annual Dividend Rate $1.04

B-

C+

C

Annual Dividend Yield 2.86%

SELL C-

D

Beta 1.06

Sector: Technology INTC BUSINESS DESCRIPTION Intel Corporation designs, manufactures, and sells integrated digital technology platforms worldwide. It operates through Client Computing Group, Data Center Group, Internet of Things Group, Software and Services, and All Other segments.

D+

D-

E+

E

E-

Market Capitalization $172.3 Billion Sub-Industry: Semiconductors

Weekly Price: (US$)

SMA (50)

F

BUY 52-Week Range $27.68-$38.36

RATING SINCE TARGET PRICE

10/07/2010 $47.04

Price as of 1/5/2017 $36.35

Source: S&P

SMA (100)

1 Year

2 Years 48

TARGET TARGET TARGETPRICE PRICE PRICE$47.04 $47.04 $47.04 TARGET

45 43 40 38

STOCK PERFORMANCE (%) 3 Mo. Price Change -4.32

1 Yr. 7.44

35

3 Yr (Ann) 12.13

33 30

GROWTH (%) Last Qtr 9.07 8.65 7.81

12 Mo. 5.01 -9.61 -9.41

3 Yr CAGR 3.43 3.09 4.64

RETURN ON EQUITY (%) INTC Q3 2016 16.19 Q3 2015 19.77 Q3 2014 18.71

Ind Avg 13.66 26.58 20.72

S&P 500 11.79 12.91 14.28

Revenues Net Income EPS

28 25 Rating History

BUY Volume in Millions

300 200 100

2015

0 2017

2016

COMPUSTAT for Price and Volume, TheStreet Ratings, Inc. for Rating History

P/E COMPARISON

RECOMMENDATION We rate INTEL CORP (INTC) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, increase in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

17.15

31.44

26.11

INTC

Ind Avg

S&P 500

EPS ANALYSIS¹ ($)

HIGHLIGHTS INTEL CORP has improved earnings per share by 7.8% in the most recent quarter compared to the same quarter a year ago. Stable earnings per share over the past year indicate the company has sound management over its earnings and share float. We anticipate these figures will begin to experience more growth in the coming year. During the past fiscal year, INTEL CORP increased its bottom line by earning $2.34 versus $2.33 in the prior year. This year, the market expects an improvement in earnings ($2.66 versus $2.34).

2014

2015

Q3 0.69

Q2 0.27

Q1 0.42

Q4 0.74

Q3 0.64

Q2 0.55

Q1 0.41

Q4 0.74

Q3 0.66

Q2 0.55

Q1 0.38

The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry average. The net income increased by 8.7% when compared to the same quarter one year prior, going from $3,109.00 million to $3,378.00 million. INTC's revenue growth trails the industry average of 25.3%. Since the same quarter one year prior, revenues slightly increased by 9.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.

2016

NA = not available NM = not meaningful 1 Compustat fiscal year convention is used for all fundamental data items.

The current debt-to-equity ratio, 0.43, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.15, which illustrates the ability to avoid short-term cash problems.

This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.

Report Date: January 8, 2017

PAGE 1

January 8, 2017 NASDAQ: INTC

INTEL CORP Sector: Technology Semiconductors Source: S&P Annual Dividend Rate $1.04

Annual Dividend Yield 2.86%

PEER GROUP ANALYSIS

100%

AVGO FA RA VO BL E

UN FA

Demand for semiconductor products is indirect and driven by sales of personal computers, cell phones, consumer electronics devices, and other electronic equipment. The industry is capital-intensive and requires significant investments to advance technology and reduce manufacturing costs. Research and development expenses form a major part of capital expenditure and the industry spends over $15 billion annually.

TSM

INTC XLNX ADI LLTC QCOM TXN

B RA VO

LE

-20%

Price as of 1/5/2017 $36.35

The industry is cyclical and subject to supply/demand fluctuations and price erosion. After experiencing a downturn during the last recessionary period, the semiconductor market is building back on renewed demand.

NVDA

25%

65%

EBITDA Margin (TTM) Companies with higher EBITDA margins and revenue growth rates are outperforming companies with lower EBITDA margins and revenue growth rates. Companies for this scatter plot have a market capitalization between $14.6 Billion and $172.3 Billion. Companies with NA or NM values do not appear. *EBITDA – Earnings Before Interest, Taxes, Depreciation and Amortization.

REVENUE GROWTH AND EARNINGS YIELD 100%

52-Week Range $27.68-$38.36

The US semiconductors and semiconductor equipment industry is known for its technological advancements. The semiconductor market includes companies that manufacture and sell integrated circuits and discrete semiconductor devices. The semiconductor equipment market includes companies that manufacture and sell equipment for the production of semiconductor devices. About 5,000 companies operate in this industry, which has approximate annual revenue of $150 billion. The top 50 companies hold more than 70% of total market share. Major players are Intel (INTC), Texas Instruments (TXN), Qualcomm (QCOM), Micron Technology (MU), and Advanced Micro Devices (AMD).

NXPI Revenue Growth (TTM)

Market Capitalization $172.3 Billion

INDUSTRY ANALYSIS

REVENUE GROWTH AND EBITDA MARGIN*

The industry is subject to various environmental regulations related to pollutant emissions, waste-water discharges, and the use of hazardous substances. The European Union’s directives, such as the Restriction of Use of Certain Hazardous Substances and the Registration, Evaluation, Authorization, and Restriction of Chemicals are relevant to the manufacturing process. China, which represents the world’s second largest semiconductor market and is a major importer of US products, also restricts the use of hazardous substances in electronic products. Although the industry is the second-largest exporting industry in the US, its global market share in chip production has eroded due to insufficient research funding, workforce challenges, and foreign incentives. The demand pattern has shifted production to low cost substitutes and shifted the demand centers to China, Taiwan, and the rest of Asia. There has also been a lateral shift of capital as research and development investments move away from the US to Asia.

AVGO FA RA VO BL E

NXPI NVDA UN LE

-3%

B RA VO

-20%

FA

Revenue Growth (TTM)

Beta 1.06

MU

TSM LLTC TXN INTC XLNX ADI QCOM 7%

Earnings Yield (TTM) Companies that exhibit both a high earnings yield and high revenue growth are generally more attractive than companies with low revenue growth and low earnings yield. Companies for this scatter plot have revenue growth rates between -13% and 94%. Companies with NA or NM values do not appear.

PEER GROUP: Semiconductors & Semiconductor Equipment Recent Market Ticker Company Name Price ($) Cap ($M) INTC INTEL CORP 36.35 172,263 QCOM QUALCOMM INC 65.55 96,810 TXN TEXAS INSTRUMENTS INC 72.92 72,883 AVGO BROADCOM LTD 174.28 69,534 NVDA NVIDIA CORP 101.74 54,838 NXPI NXP SEMICONDUCTORS NV 98.40 34,047 MU MICRON TECHNOLOGY INC 22.11 24,306 ADI ANALOG DEVICES 71.32 21,979 TSM TAIWAN SEMICONDUCTOR MFG C 29.80 154,545 LLTC LINEAR TECHNOLOGY CORP 61.98 14,897 XLNX XILINX INC 57.93 14,628

Price/ Earnings 17.15 17.20 23.15 NM 52.44 37.56 NM 25.84 15.94 30.53 25.75

Net Sales TTM ($M) 57,927.00 23,554.00 13,145.00 13,240.00 6,138.00 8,664.00 13,019.00 3,421.41 28,247.89 1,455.91 2,291.49

Net Income TTM ($M) 10,367.00 5,705.00 3,251.00 -1,739.00 1,220.00 652.00 -302.00 861.66 9,747.10 497.42 603.10

The peer group comparison is based on Major Semiconductors companies of comparable size.

This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.

Report Date: January 8, 2017

PAGE 2

January 8, 2017 NASDAQ: INTC

INTEL CORP Sector: Technology Semiconductors Source: S&P Annual Dividend Rate $1.04

Annual Dividend Yield 2.86%

Beta 1.06

Market Capitalization $172.3 Billion

52-Week Range $27.68-$38.36

Price as of 1/5/2017 $36.35

COMPANY DESCRIPTION Intel Corporation designs, manufactures, and sells integrated digital technology platforms worldwide. It operates through Client Computing Group, Data Center Group, Internet of Things Group, Software and Services, and All Other segments. The company's platforms are used in various computing applications comprising notebooks, 2 in 1 systems, desktops, servers, tablets, smartphones, wireless and wired connectivity products, wearables, retail devices, and manufacturing devices, as well as for retail, transportation, industrial, buildings, home use, and other market segments. It offers microprocessors that processes system data and controls other devices in the system; chipsets, which send data between the microprocessor and input, display, and storage devices, such as keyboard, mouse, monitor, hard drive or solid-state drive, and optical disc drives; and system-on-chip products that integrate its central processing units with other system components onto a single chip. The company also provides communication and connectivity offerings, such as baseband processors, radio frequency transceivers, and power management integrated circuits; and tablet, phone, and Internet of Things solutions, which include multimode 4G LTE modems, Bluetooth technology and GPS receivers, software solutions, and interoperability tests, as well as home gateway and set-top box components. In addition, it offers security solutions for computers, mobile devices, and networks, as well as software and services for technology integration; NAND flash memory products, which are used in solid-state drives; and custom foundry services, including custom silicon, packaging, and manufacturing test services. The company sells its products primarily to original equipment manufacturers, original design manufacturers, and industrial and communications equipment manufacturers in the computing and communications industries. Intel Corporation was founded in 1968 and is based in Santa Clara, California.

STOCK-AT-A-GLANCE Below is a summary of the major fundamental and technical factors we consider when determining our overall recommendation of INTC shares. It is provided in order to give you a deeper understanding of our rating methodology as well as to paint a more complete picture of a stock's strengths and weaknesses. It is important to note, however, that these factors only tell part of the story. To gain an even more comprehensive understanding of our stance on the stock, these factors must be assessed in combination with the stock’s valuation. Please refer to our Valuation section on page 5 for further information.

INTEL CORP 2200 Mission College Boulevard Santa Clara, CA 95054 USA Phone: 408-765-8080 http://www.intel.com Employees: 107000

THESTREET RATINGS RESEARCH METHODOLOGY

FACTOR

SCORE

4.5

Growth out of 5 stars weak Measures the growth of both the company's income statement and cash flow. On this factor, INTC has a growth score better than 80% of the stocks we rate.

strong

3.0

Total Return out of 5 stars weak Measures the historical price movement of the stock. The stock performance of this company has beaten 50% of the companies we cover.

strong

5.0

Efficiency out of 5 stars weak Measures the strength and historic growth of a company's return on invested capital. The company has generated more income per dollar of capital than 90% of the companies we review.

strong

4.5

Price volatility out of 5 stars weak Measures the volatility of the company's stock price historically. The stock is less volatile than 80% of the stocks we monitor.

strong

5.0

Solvency out of 5 stars weak Measures the solvency of the company based on several ratios. The company is more solvent than 90% of the companies we analyze.

strong

4.5

Income out of 5 stars weak Measures dividend yield and payouts to shareholders. The company's dividend is higher than 80% of the companies we track.

strong

TheStreet Ratings' stock model projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Our Buy, Hold or Sell ratings designate how we expect these stocks to perform against a general benchmark of the equities market and interest rates. While our model is quantitative, it utilizes both subjective and objective elements. For instance, subjective elements include expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings. Objective elements include volatility of past operating revenues, financial strength, and company cash flows. Our model gauges the relationship between risk and reward in several ways, including: the pricing drawdown as compared to potential profit volatility, i.e.how much one is willing to risk in order to earn profits; the level of acceptable volatility for highly performing stocks; the current valuation as compared to projected earnings growth; and the financial strength of the underlying company as compared to its stock's valuation as compared to projected earnings growth; and the financial strength of the underlying company as compared to its stock's performance. These and many more derived observations are then combined, ranked, weighted, and scenario-tested to create a more complete analysis. The result is a systematic and disciplined method of selecting stocks.

This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.

Report Date: January 8, 2017

PAGE 3

January 8, 2017 NASDAQ: INTC

INTEL CORP Sector: Technology Semiconductors Source: S&P Annual Dividend Rate $1.04

Annual Dividend Yield 2.86%

Consensus EPS Estimates² ($) IBES consensus estimates are provided by Thomson Financial

0.74

2.66 E

2.80 E

Q4 FY16

2016(E)

2017(E)

Market Capitalization $172.3 Billion

52-Week Range $27.68-$38.36

Price as of 1/5/2017 $36.35

FINANCIAL ANALYSIS INTEL CORP's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the industry average, its revenue growth has not. INTEL CORP has average liquidity. Currently, the Quick Ratio is 1.15 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year. During the same period, stockholders' equity ("net worth") has increased by 10.34% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future. STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. To learn more visit www.TheStreetRatings.com.

INCOME STATEMENT Net Sales ($mil) EBITDA ($mil) EBIT ($mil) Net Income ($mil)

Beta 1.06

Q3 FY16 15,778.00 6,762.00 4,834.00 3,378.00

Q3 FY15 14,465.00 6,481.00 4,206.00 3,109.00

Q3 FY16 17,769.00 112,217.00 27,600.00 64,001.00

Q3 FY15 20,843.00 98,552.00 21,147.00 58,002.00

Q3 FY16 75.02% 42.85% 30.64% 0.52 9.23% 16.19%

Q3 FY15 78.24% 44.80% 29.08% 0.56 11.63% 19.77%

Q3 FY16 1.80 0.30 216.00 22.38

Q3 FY15 2.40 0.27 168.00 25.04

Q3 FY16 4,739 0.26 0.69 13.51 NA 20,495,135

Q3 FY15 4,730 0.24 0.64 12.26 NA 21,859,829

BALANCE SHEET Cash & Equiv. ($mil) Total Assets ($mil) Total Debt ($mil) Equity ($mil) PROFITABILITY Gross Profit Margin EBITDA Margin Operating Margin Sales Turnover Return on Assets Return on Equity DEBT Current Ratio Debt/Capital Interest Expense Interest Coverage SHARE DATA Shares outstanding (mil) Div / share EPS Book value / share Institutional Own % Avg Daily Volume

2 Sum of quarterly figures may not match annual estimates due to use of median consensus estimates.

This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.

Report Date: January 8, 2017

PAGE 4

January 8, 2017 NASDAQ: INTC

INTEL CORP Sector: Technology Semiconductors Source: S&P Annual Dividend Rate $1.04

Annual Dividend Yield 2.86%

RATINGS HISTORY Our rating for INTEL CORP has not changed since 10/7/2010. As of 1/5/2017, the stock was trading at a price of $36.35 which is 5.2% below its 52-week high of $38.36 and 31.3% above its 52-week low of $27.68. 2 Year Chart

Beta 1.06

Market Capitalization $172.3 Billion

BUY: $35.95

Price/Earnings

1

2

3

premium

$30

2015

4

5

INTC 17.15 Peers 31.44 • Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations. • INTC is trading at a significant discount to its peers. Price/Projected Earnings

From Buy

To Buy

RATINGS DEFINITIONS & DISTRIBUTION OF THESTREET RATINGS

3

41.76% Buy - We believe that this stock has the opportunity to appreciate and produce a total return of more than 10% over the next 12 months. 30.40% Hold - We do not believe this stock offers conclusive evidence to warrant the purchase or sale of shares at this time and that its likelihood of positive total return is roughly in balance with the risk of loss. 27.85% Sell - We believe that this stock is likely to decline by more than 10% over the next 12 months, with the risk involved too great to compensate for any possible returns.

4

5

Price/Book

1

2

3

premium

4

5

Price/Sales

1

2

premium

3

4

5

Price to Earnings/Growth

4

5

discount

1

2

3

premium

4

5

discount

INTC 1.21 Peers 1.90 • Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. • INTC trades at a significant discount to its peers. Earnings Growth

1

2

3

4

lower

5 higher

INTC -9.41 Peers 17.51 • Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. • However, INTC is expected to significantly trail its peers on the basis of its earnings growth rate. Sales Growth

discount

INTC 2.97 Peers 4.57 • Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. • INTC is trading at a significant discount to its industry on this measurement.

3

INTC 9.01 Peers 18.43 • Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. • INTC is trading at a significant discount to its peers.

discount

INTC 2.69 Peers 4.45 • Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. • INTC is trading at a significant discount to its peers.

2

premium

discount

INTC 12.98 Peers 18.95 • Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations. • INTC is trading at a significant discount to its peers.

(as of 1/5/2017)

Research Contact: 212-321-5381 Sales Contact: 866-321-8726

2

premium

Price reflects the closing price as of the date listed, if available

TheStreet Ratings 14 Wall Street, 15th Floor New York, NY 10005 www.thestreet.com

1

1

Price/CashFlow

discount

2016

MOST RECENT RATINGS CHANGES Date Price Action 1/5/15 $35.95 No Change

Price as of 1/5/2017 $36.35

VALUATION BUY. The current P/E ratio indicates a significant discount compared to an average of 31.44 for the Semiconductors & Semiconductor Equipment industry and a discount compared to the S&P 500 average of 26.11. To use another comparison, its price-to-book ratio of 2.69 indicates valuation on par with the S&P 500 average of 2.89 and a significant discount versus the industry average of 4.45. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, INTEL CORP proves to trade at a discount to investment alternatives within the industry.

$40 $35

52-Week Range $27.68-$38.36

1

2

3

lower

4

5 higher

INTC 5.01 Peers 12.62 • Lower. A sales growth rate that trails the industry implies that a company is losing market share. • INTC significantly trails its peers on the basis of sales growth

DISCLAIMER: The opinions and information contained herein have been obtained or derived from sources believed to be reliable, but TheStreet Ratings cannot guarantee its accuracy and completeness, and that of the opinions based thereon. Data is provided via the COMPUSTAT® Xpressfeed product from Standard &Poor's, a division of The McGraw-Hill Companies, Inc., as well as other third-party data providers. TheStreet Ratings is a division of TheStreet, Inc., which is a publisher. This research report contains opinions and is provided for informational purposes only. You should not rely solely upon the research herein for purposes of transacting securities or other investments, and you are encouraged to conduct your own research and due diligence, and to seek the advice of a qualified securities professional, before you make any investment. None of the information contained in this report constitutes, or is intended to constitute a recommendation by TheStreet Ratings of any particular security or trading strategy or a determination by TheStreet Ratings that any security or trading strategy is suitable for any specific person. To the extent any of the information contained herein may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person. Your use of this report is governed by TheStreet, Inc.'s Terms of Use found at http://www.thestreet.com/static/about/terms-of-use.html.

This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.

Report Date: January 8, 2017

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