UPDATE: B. Riley & Co. Downgrades Intel on Move to Sidelines

In a report published Wednesday, B. Riley & Co. analyst Craig A. Ellis downgraded the rating on

from Buy to Neutral, but raised the price target from $28.50 to $29.00. In the report, B. Riley & Co. noted, “Revenues were slightly below/in-line with the Street's $12.76B/$13.00B but the mid-yr ramp to 63.0% GM was a pleasant surprise. However, from there 2H14 tablet margin mix pressures GM 100-200 bps/qtr to leave OM flattish from 2Q14-4Q14 despite falling opex. This means BR C14 EPS rise just $0.03 to $1.94, much less than we'd have expected with such sharp nt GM surge. "For the stock – which we upgraded to ‘Buy' in mid-October expecting PC stability to ultimately price in, we believe this sets up a tough 2H14 catalyst profile at a time when PCG's qq growth risks escalate. So, while our PT rises from $28.50 to $29.00 on a C14 EPS nudge higher, with just 10% total return with the 3.5% divi yield from a $27.20 AMC price we move to the sidelines, downgrading from Buy to Neutral.” Intel closed on Tuesday at $26.77.