Intel: Maxim Starts at Buy, UBS Ups Target to $34

Intel (INTC) shares get two thumbs up today, with Maxim Group‘s Ashok Kumar starting the stock at Buy, with a $33 price target, and with UBS’s Uche Orji raising his price target on the stock to $34 from $31.

Kumar thinks any contraction in global PC shipments, and any threat from global economic decline, will be mitigated by Intel through a combination of strength in server sales, higher processor prices, on average, share gains, and lowr costs for “Sandy Bridge” processors.

The company’s forthcoming “Romley” processor for servers, and its “Ivy Bridge” processors using 3D transistors, may boost Intel’s market share to 81.6% this year from 81.1%, he speculates.

The slimmer, lighter “ultrabook” laptops shipping with Intel processors may help offset some incursions by tablet computers into the PC market, Kumar muses.

And the server market is still at early innings for Intel, he writes:� “Although Intel has >400 design wins for Romley, its customers are still at the initial stage of migrating from 1-2P servers to MP virtualized machines.”

Kumar is betting on slow progress for Intel over time in selling phone and tablet chips (though it would be a big improvement from almost nothing now): Intel may sell 13% of smartphone chips by 2015 and 15% of tablet chips.

At 10.5% times 2012 estimated EPS of $2.55, the shares represent a good value, he writes. Kumar’s estimate is 10 cents ahead of consensus on revenue of $57.6 billion, higher than the consensus $56.7 billion this year.

UBS’s Orji writes that spending by companies building data centers is set to rise faster this year, with capex perhapst appreciating by 49%, versus the 32% growth in 2011.

Orji thinks that could add 24% to server processor shipments, and perhaps provide for as much as another 7% on top of the $2.60 per share he’s forecasting for Intel’s EPS this year.

“Despite improved products from Advanced Micro Devices (AMD) and ARM Holdings (ARMH)-based competition, we believe Intel can largely sustain share as it leverages its process advantage, product breadth and software/support,” writes Orji.

“We expect it to remain dominant in the mainstream with Romley, given the up to 80% performance improvement vs its prior gen, and at the low-end, we expect it to make a significant effort to counter the ARM threat.

Intel shares today are down 34 cents, or 1.3%, at $26.40.