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Intel’s Investment Decision

American engineers Gordon Moore and Robert Noyce established Intel Corporation

in July 1968. In terms of technological innovation, Intel has always been the leader in the

industry due to its unique hardware and software solutions (Cherstvy et al.). The company

has made newsworthy contributions to the development of high-performance processors for

enterprise-scale servers, IoT devices, and household computers. Last year, it was received

fourth place in the the 2018 Global Innovation 1000 study, solidifying its position as one of

the most innovative companies in the world. However, during the recession, the consumers

switched to more affordable products, and the decrease in Intel’s brand value was a visible

result of the switch, which is why the company has to make sound investment decisions to

stay ahead of such competitors as AMD and increase the average price of the company’s

market stock.

Mission

Intel’s mission statement of informs the customers that it is an IT firm that manufactures

computer hardware such as semiconductors, printing systems, storage systems, servers, and

mainframes (Grant). It also provides software solutions for the management of operating

systems, networking, and integration of business. The mission statement of Intel offers proper

guidance regarding the company’s organizational activities since one of Intel’s primary goals

is to provide its clients with the most advanced information technologies. Such technologies

include microelectronics, storage gadgets, networking structures, software, and computer

structures with the most affordable options of products. The mission statement keeps Intel’s
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employees focused on achieving the company’s goals. It guides them to make decisions that

are beneficial to the business. It acknowledges the strengths of the organization and informs

the workers on the strategies they can use to achieve competitive advantage.

Vision

The vision statement of Intel states that: ‘it is best with Intel in case it linked and smart’

(Cherstvy et al.). The following are significant features of the vision statement.

General Strategy

The computing technology and semiconductor business of Intel Corporation grows through

successful intensive growth strategies and suitable generic strategy (Fleisher & Bensoussan).

Intel’s generic approach relies on innovations, which distinguish its products from that of the

rival companies. Moreover, the intensive growth strategies focus on the products' cutting-

edge technologies which attract target clients in the whole world and shape the sector.

Differentiation is the generic competitive strategy of Intel Company (Grant). These generic

strategies build a competitive edge based on the management of brand image, customer

services, and product features. Intel invests in quick innovations to generate related

technological products and cutting-edge microprocessors (Cherstvy et al.). The improved

characteristics of the goods guarantee leadership in the international market help the company

to realize its vision and mission statement. The differentiation generic strategy helps the

company to sustain its competitive edge against its main rival AMD. Differentiation demands

strategic goals, which is why Intel a leader in the industry due to its unique differentiation

strategy. One of the company’s strategic goals is to create new commodities, which the rival

firms cannot easily imitate. For instance, designing more energy-efficient and fast processors

can reinforce the industry position of Intel, particularly in the market of mobile devices

(Martins & Lopes, 2016). Another strategic goal is to enhance the aggressiveness and

competitive advantage of Intel in the mobile device market.

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Internal Conditions of the Firm

The dedication of Intel to corporate sustainability and responsibility is established on a robust

base of ethics and transparency (Cherstvy et al.). The company’s transparency creates value

for the company and its shareholders by assisting it to recognize new market prospects, build

brand values, minimize expenses, and mitigate losses (Fleisher & Bensoussan). The company

can harness more individuals through its technologies and data power. This helps the

corporation handle the most complex matters of the community such as human rights,

economic empowerments, the efficiency of energy and climatic changes.

Why Intel is a Good or Bad Investment

Throughout the globe, Intel has similar market shares (Grant). Equivalent to $ 3.00 per

common stock shares, for the previous year, the net profit and income were $ 21 million and

$ 207 million respectively. Intel is doing well financially. Intel consumers prefer the

company’s products because of their quality and effectiveness. However, Intel shares went

down by 20% compared to their company’s evaluations at the beginning of the year.

Regardless of its current position, Intel has a strong reputation that will help the company

withstand the competition in the future (Martins & Lopes 234-242). The company has

exceeded the predictions of the financial analysts, even though the price of the company’s

shares fell. The current decrease in stock price is reasonably suitable for corrections that have

created a market for its shares. The stocks have increased by 21% since July reaching the

retail price of $56. Regardless of the current recession, Intel is still a reliable company. The

corporation grew 10 times bigger than AMD, its main rival, despite the company’s

anticipated 2018 earnings. In 2019, the company is likely to increase the price of its shares

and provide stable dividends for the stockholders (Grant, 2016). Intel has shown a strong

ability to exceed the predictors’ expectations in recent months, which implies the company’s

capability to withstand the challenges in a highly competitive industry.

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Therefore, the current corrections have created remarkable purchasing prospects for

Intel stocks, showing that the company’s stocks might significantly grow in 2019 (Cherstvy

et al.). The shares of Intel over the last few months obtained the needed attention, going up as

high as $56 in price and with the lowest being $45. At an artificially low price, the high levels

of volatilities offer opportunities to the investors to buy the shares. The investors searching

for expansions in their portfolios might want to consider the opportunities of Intel before

buying the stocks. At lower prices, more captivating investment portfolios could be

expanded. It appears that high cash flow per share benefits the company’s financial situation.

Now may not be the most suitable period to buy the company’s shares, given that the

company is conducting the business around its fair values (Fleisher & Bensoussan). The

optimist opportunities for the firm are promising.

Intel can guarantee that it's capital deployment will improve the value of long-term

stockholder, or the company will pay dividends on its common stock (Grant). Its program of

capital deployment may increase the volitivity of the price of its common stock and decrease

its cash reserves. Additionally, any determination to stop paying dividends or repurchasing

stock, or any future repurchases Intel dividends or common stock could affect the stock,

making its price fluctuate (Fleisher & Bensoussan, 2015). A share repurchase program exists

and any future dividends could make the stock price of Intel grow, which would decrease the

stock's market liquidity. Also, any next common stock or dividends repurchase shall reduce

the cash reserves of Intel, which could affect its ability to pursue possible future acquisitions

and strategic opportunities. Moreover, its common stock repurchase could fluctuate, making

its cash flows inadequate to completely cover its share repurchases (Martins & Lopes 234-

242). Share repurchase programs could also not improve the long-term stockholder value

although that it is their primary intention because the standard stock price could decrease
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below the levels at which it repurchased stock shares. Moreover, the price of a short-term

stock fluctuations may reduce the effectiveness of the program.

Recommendations

With the predicted increase in profits of more than 56% in the next few years, Intel's’ future

appears to be bright (Cherstvy et al.). This means that it is worth examining deep into other

elements of the company, such as the strength of the financial statement to take advantage of

the next decrease in prices. Investment planning is vital so as to save more of what the

company earns as well as earnings from the ventures. Wise investment planning is essential

in achieving financial freedom and the needs of a firm. It is necessary to establish the

business goals and plan for what the company seeks to accomplish (Grant). Equally,

understanding financial assets will assist in investment planning because the assets

allocations intend to meet the business needs. When creating an investment plan, it is

important to specify clear steps to make the strategy more structured. First, Intel will have to

establish and its clear objectives to make the investment plan feasible. The company has to

outline the actions that would help it achieve its set investment goals. Therefore, the company

has to determine what it intends to make and how it wants to succeed in the future (Fleisher

& Bensoussan). After setting the goals, they should be divided into short-term and long-term

goal targets.

Conclusion

Famous for its quality products, Intel has for a long time led the technology industry by

producing quality products that meets the needs of the customers. It is one of the only brands

that embraces online sales with a long streak of commercial success. With the revenue

reaching $9.62 billion for 2017, which is 11% increase from the previous year, Intel has

remained competitive in the technology industry. The company has remained robust than its

peers, where sales grew by 16.5%. From the previous year, the profit increased by 18.5% or
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$1.79 billion. Intel has invested in digital services and technologies that connect the

operations in all of its stores. But while the quality items of the company can be purchased

online, most of the sales are still conducted offline, despite the industry’s significant

expansion from e-commerce.

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Works Cited

Cherstvy, A. G., Vinod, D., Aghion, E., Chechkin, A. V., & Metzler, R. Time Averaging,

Aging and Delay Analysis of Financial Time Series. New Journal of Physics, 2017.

Fleisher, C. S., & Bensoussan, B. E, Business and Competitive Analysis: Practical

Application of New and Classic Methods. FT Press, 2015.

Grant, R. M., Contemporary Strategy Analysis: Text and Cases Edition. John Wiley & Sons,

2016.

Martins, M. M., & Lopes, I. T. Intellectual Capital and Profitability: A Firm Value Approach

in European Companies. Verslas Teorija ir Praktika, vol. 17, no. 3, 2016, pp. 234-

242.
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