It’s been a fantastic day for Intel (NASDAQ:INTC), which is something we don’t hear often for the chip stock. However, new reports about its potential resurgence in the second half, as well as its potential issues from competitor Advanced Micro Devices (NASDAQ:AMD), were enough to send shares blasting up over 5% in Monday afternoon’s trading.
Intel hasn’t exactly made big strides with artificial intelligence (AI) lately, falling far behind competitors like Nvidia (NASDAQ:NVDA). A new report from Melius Research analysts, though, suggests that may turn around starting in the second half. Melius called Intel an “AI Laggard” for the first half of 2024, but that could be a bit of good news.
Melius noted that something similar happened in 2023, where so-called “underdogs” like these might falter in the first half of the year but realize their lack and come back stronger in the second half. And, while many analysts will say, past performance is not indicative of future performance, most realists believe it’s the only real measure we have available.
A Mixed Bag from AMD
Meanwhile, some interesting news came out about AMD, which could go either way. First, there were some concerns about the Ryzen 9 9900X chip. This next-gen Ryzen chip is said to be a powerhouse and one that might be enough to worry Intel. In fact, the 9 9900X offered a 10.1% improvement in speed over the Intel Core i9-14900K, which should indeed be concerning.
However, there was a positive development for Intel, as AMD’s key advantage of outsourcing manufacturing could be in open decline. In fact, Intel is becoming less resistant to outsourcing its manufacturing while also looking to improve its foundry capabilities. That’s going to leave AMD scrambling to pick up the pieces and forge a new advantage or risk falling behind.
Is Intel a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on three Buys, 25 Holds, and three Sells assigned in the past three months, as indicated by the graphic below. After a 4.6% rally in its share price over the past year, the average INTC price target of $38.02 per share implies 12.45% upside potential.
