Download Link
I created this model to:
👷♂️ Build initial modeling skills
🤔 Understand Intel more
🔬 Refine my investment thesis with real data
🤝 Share insights with others interested in Intel’s valuation
🧪 Test different valuation scenarios over time
Below is the download link—please note that it’s a work-in-progress, and your feedback is welcome. You can comment on this post, DM me on X, or reply to this email.
Here is the download for the model:
Note: This model is a living document—I will continue refining and updating it as new information becomes available. If you notice any errors, room for improvement, or have thoughts on the assumptions, I welcome your feedback.
Summary
Highlights
🗺️ Geopolitical Tensions
USA preference for USA chips has Intel positioned as extremely misunderstood
TSMC 100b investment is for show
China has mentioned extreme interest in Taiwan
🚀 Return to product leadership
Intel recently completed 4 nodes in 5 years, kicking off a new confidence in Intel products. Although external customers are keeping quiet, Intel is getting more interest.
💸 INTC stock is below 1 P/B
Given the history and flops, Intel deserves to be cheap, but not this cheap. Even when considering P/TBV, INTC is extremely low.
Key Concerns
🧭 Trump is a wildcard
There is no guarantee that Trump will actually enforce on Taiwan, but the incentives are still there for companies to buy from Intel.
👹 Yeary and the board are incompetent
Firing Pat Gelsinger may have been a terrible mistake.
Intel is going on 96 days without a CEO as of today.
Yeary needs to go. Gelsinger needs to come back.
💩 Execution Risk & Manufacturing Delays
Intel keeps pushing back products and fabs. While pushing back fabs makes sense, product delays are an unwelcome development.
Room for improvement
A few things I want to improve over time:
I got stuck with comparables in the WACC calculation, specifically in market value of debt. I’ll have to tackle this another time.
I’m very interested in modeling out the company specific data, learning about standard practices, and minimizing errors.
It’s abundantly clear why some analysts spend their entire careers in one industry or sub-industry. There’s a mountain of never-ending information waiting to be sifted through, analyzed, and synthesized for tangible investment outcomes. I hope to learn more about this amazing industry.
There are some simple calculations that I did not prepare (yet). One of those is IRR on the summary page that should tie to the current price of INTC stock. The second is the “score” on the summary page. The goal over time is to tie each of those value to a tangible metric in the filings on the company.
I’d like to calculate SBC into the equation but haven’t gotten there yet.
What’s working well so far:
I love the summary page design, and I think having a radar chart sums up the thesis nicely.
I learned some more sweet excel skills (yes I know🤓) like a dropdown selector for scenarios:
The granularity of assumptions within segments has me delighted. I’m not quite sure how to tie in lengthy commentary without using a ton of cell notes, however. That just feels tacky.
The model is a great place to update assumptions as I keep learning about Intel, semiconductors, and the semiconductor industry. I hope to do this at least quarterly on earnings.
Conclusion
Overall, I believe Intel is significantly undervalued given the current geopolitical landscape, despite ongoing manufacturing challenges and board instability. I plan to update this model quarterly, so stay tuned!