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Intel (INTC) is among the largest semiconductors companies globally, but it has underperformed the broader markets by a wide margin over the past two decades. Valued at a market cap of $85.4 billion, Intel stock is down nearly 40% over the past 10 years. It also trades over 72% below all-time highs as it has lost market share to peers Nvidia (NVDA) and Advanced Micro Devices (AMD).
Given its beaten-down valuation, let’s see if you should invest in INTC stock right now.
Intel’s New CEO Outlines Long-Term Vision
During Intel’s Vision 2025 conference last week, newly appointed CEO Lip-Bu Tan laid out his vision for rebuilding the chipmaker’s engineering-led culture. Tan’s presentation acknowledged Intel’s significant shortcomings: loss of engineering talent, lack of innovation, and deterioration of customer trust.
The CEO repeatedly stressed cultural transformation, proposing a “day-1 startup culture” focused on innovation. He plans to solicit customer feedback, recruit top engineering talent, and potentially spin off non-core businesses.
The event showcased Intel’s three-pronged strategy to gain traction in the artificial intelligence segment and strengthen data center capabilities.
On the foundry front, executives announced that Intel’s advanced 18A manufacturing process has entered the “risk production” phase. This refers to the process of scaling up production from hundreds to thousands of units.
Intel also emphasized its partnerships with customers like Zoox, EdgeRunner AI, and Softec, demonstrating how Intel technology enables autonomous vehicles, military applications, and healthcare solutions.
Stifel Maintains a ‘Hold’ Rating on Intel Stock
Analysts at Stifel maintained a “Hold” rating on Intel with a $21 price target. Notably, analysts from Stifel and Truist Securities expressed encouragement following Tan’s address.
According to a report from Seeking Alpha, Truist called it “the most constructive message we’ve heard from Intel in... as long as we’ve covered the company,” noting the refreshing focus on culture rather than products or manufacturing nodes. More details on Intel’s crucial Foundry strategy are expected at the Intel Foundry Direct Connect event in late April.
Out of the 36 analysts covering INTC stock, one recommends “Strong Buy,” 31 recommend “Hold,” and four recommend “Strong Sell.” The average target price for Intel stock is $24.62, indicating an upside potential of over 20% from current levels.
