INTEL

Balance sheet Analysis:

INTC BALANCE SHEET (ANNUAL)

Closing date 30/12/2021
Total assets 168 406 000,00
Current Assets 57718000,00
Invetories 10776000,00
Accounts receivable 9457000,00
Total non current assets 110688000,00
Goodwill 26963000,00
Identified intagible assets 7270000,00
Total liabilities Net minory Interest 73015000,00
Current liabilities 27462000,00
Total Non current liabilities 45553000,00
Total Equity Gross Minority Interest 95391000,00
Stockhoulders's Equity 95391000,00
Total Capitalization 128901000,00
Common Stock Equity 95391000,00
Net Tangible Assets 61158000,00
Working Capital 30256000,00
Invested Capital 133492000,00
Tangible Book Value 61158000,00
Total Debt 38101000,00
Net debt 33274000,00
Share Issued 4070000,00
Ordinary Shares Number 4070000,00
Total liabilities+Stockhoulders's
Equity 168406000,00

Debt to Equity Quick Inventory

Ratios Ratio Ratio Turnover Net Tangible asset DSO DPO
INTEL 0,39 1,7 0,85 61158000 43,7 254,41
The average of the
industry 2,66 1,5 9,79 127 815 420 74,6 58,17

For the INTEL Company, I will start first by analyzing the balance sheet using some ratios.
It’s very important to compare them to the average of the industry since each one has its own
characteristics. For example for the high tech industry, we take higher risks in our
investments, therefore we expect a higher average of debt of equity ratio.
 -We have here just 0.39 which is very low, so we can say that INTEL is not taking enough
risks for its industry

- The quick ratio is good, INTEL can pay its short term debts using its liquidated assets easily

-The inventory turnover is very low, it could be an indication of weak sales or excess
inventory, and we might want to remember this hypothesis and see if we can confirm it with
the growth sales during the performance analysis.

- DSO is shorter than the average, which is good, we can say that INTEL receives its payment
quickly…

Performance Analysis:

Growth
Performance EBITDA margin Profit margin
Ticker sales (yoy)
(Ebitda / Sales) (Earnings / Sales)
%
INTC -22% 34,51% 26,03%

Average of the industry   8% 30% 17%

Analyzing the performance, we compare the EBITDA margin to the average of the industry:

-Here we have 34.51% which is slightly higher than the average. I wouldn’t say that INTEL is
over performing per se since the difference is not that important, but it’s safe in terms of
performance

-The growth sales on the other hand are very disappointing, which goes hand in hand with
what I said during the balance sheet analysis

Future pricing stock:

Entreprise Entreprise Numbe

Value N+1 Value N+1 Average of r of
Company Initial price Maket cap (B$) TEV (B$) sales Ebitda both EV shares Future pricing stock
Intel 27,18 113,49 121,88 113,28746 161,0409 137,164187 4 32,194

In order to evaluate the future pricing stock, we calculate a variation consisting of “(Future
pricing stock-Initial price)/Initial price”, in this case, the variation is 18%.
The variation is positive, which shows a possible overvaluation of the future pricing stock and
encourages the investment.

ESG

Company name Environment Risk Score Social risk Score Governance Risk Score TOTAL ESG RISK score
INTEL 4,4 5,9 7 17

As low as it is, INTEL communicated its ESG score which is significant enough.

Going through the company’s website, it appears that the company is working on a new
sustainability strategy named “RISE 2030”, which aims to leverage their leadership position
in the global technology ecosystem to create a more responsible, inclusive and sustainable
world, enabled through its technology and the expertise and passion of employees.

This initiative marks INTEL’s intention to develop its ESG score, which may create a
competitive advantage and attract more investors.

Debt/Equity Mix
Financing Yahoo Finance MRQ (B$) Intel
Debt to Capital Ratio 27%
Debt Level 39,52
Average of the industry( debt to capital ratio) 0,46
Gain/Loss to average 27,81037037

The average is positive first of all, which is a good sign, then we can say that INTEL can take up
to 27,81B of debt,

Mechanics of costs of capital:

Financing Yahoo Finance Intel Average of the industry

Cost of debt 12% 14%
Cost of equity 36% 23%
Cost of Capital 1,047893 22%
Sensitivity coefficient 0,73

INTEL’s cost of capital is of 1%, which means that it has to reach the minimum rate of 1% in
order to generate value, which is very low compared to the average that goes up to 22%,
which supposes an underlying issue of not taking enough risks.

Its cost of debt is of 12%, which means that INTEL pays its debts at the interest rate of 12%,
it’s somehow close to the average of the industry, which is neutral…

Its cost of equity is of 36%, which is higher than the average of the industry, which means
that INTEL has to pay out to equity investors at the rate of return of 36%. It’s higher than the
cost of debt which makes sense since equity investors involve a higher risk.

The sensitivity coefficient is lower than 1, which means that INTEL's stock is less volatile with the
market

ROC

Cost of Capital 1%
After-Tax ROC -22%
Return Spread -23%

-The return on capital is very low and even negative, which means that INTEL is destroying
its capital instead of benefiting from its investment
-The return spread is negative, which means that the cost of funds borrowed to finance
INTEL’s investments outweighs the yield on the assets, which translates into a bad
management of the invested capital

Dividend

Marekt Cap 113,49

Buyback -2415000
Payout Ratio 27,51%
Net income of last year 19868000
Forward Annual Dividend Rate 4.98%
Cash of shareholders/Dividends 6458048,8
FCFE 29789800
23331751,2
FCFE-Dividends

-Starting with the Payout Ratio of 27.51%, which translates into how much the company is
paying in the form of cash dividends per share. Generally, a company that pays out less than
50% of its earnings in the form of dividends is considered stable, and the company has the
potential to raise its earnings over the long term.

- The FCFE measures the amount that could be paid out to shareholders after all expenses and
debts have been paid, that could be possible for INTEL since the difference is positive,
generally investors want to see that a company's dividend payments are paid in full by FCFE.