Intel (INTC) has had a rough few years, but its board isn’t backing down from its turnaround efforts. With former CEO Pat Gelsinger stepping aside, the company has placed its bets on semiconductor industry veteran Lip-Bu Tan. Tan has taken up his new role just this week, marking a significant moment in Intel’s history. Tan isn’t just another executive; he’s a seasoned leader with the experience and track record to potentially pull off a revival. Challenges remain, but there’s reason for cautious optimism about Intel’s future under his leadership.
I’m staying bullish on the legacy chip maker despite its sluggish revenues, the flurry of Chinese imports, and its lack of AI data center support.
Meet Lip-Bu Tan: The Turnaround Maestro
Lip-Bu Tan is not your typical CEO. He’s a semiconductor industry heavyweight with a resume that speaks for itself. As the former CEO of Cadence Design Systems (CDNS), he oversaw a staggering 3,200% stock rally over 12 years. His deep background in physics, engineering, and technology investing makes him one of the most respected figures in the industry. Plus, he’s no stranger to Intel—he sat on the company’s board from 2022 to 2024, giving him a front-row seat to its strengths and weaknesses before stepping into the CEO role.
Under Tan’s leadership, he will receive $25 million in performance-based stock options, aligning his financial incentives with Intel’s turnaround efforts. This won’t be his first significant stake in the company, either. He bought $3 million of Intel shares in November 2022 and another $2.5 million in November 2023. This kind of financial commitment sends a strong message: Tan believes in Intel’s future and puts his money where his mouth is.
However, confidence and sentiment alone aren’t enough. Gelsinger also believed in Intel’s long-term potential, yet he ultimately didn’t deliver the results shareholders expected. The big question now is whether Tan can succeed where Gelsinger fell short. Investors have seen Intel struggle with leadership changes before, but Tan’s mix of technical know-how and financial acumen may finally give the company the stability and direction it desperately needs.
Short-Term Pain Leads to Long-Term Potential
Intel’s financials have been, in a word, rough. Annual revenue almost halved during the COVID years. Even worse, its net income nosedived from $20 billion to an $18.8 billion loss in 2024. Meanwhile, competitors like Advanced Micro Devices (AMD), NVIDIA (NVDA), and Taiwan Semiconductor Manufacturing Company (TSM) have surged ahead, capitalizing on the AI boom while Intel struggles to keep up.
But here’s the silver lining: Intel’s stock is now trading at an appealing valuation. At around $26 per share—just above book value—the stock appears undervalued relative to historical multiples. If Tan can implement an effective turnaround strategy, there’s significant upside potential. My 12- to 18-month price target is $35, assuming Intel’s management can outline a clear path to profitability and operational efficiency. There will likely be some turbulence ahead, but long-term investors might find this an attractive entry point.
Intel Investors Must Stay Vigilant
While Intel is working on its comeback, NVIDIA and AMD remain the dominant forces in semiconductor design, and TSMC’s manufacturing stronghold is nearly unbreakable. Intel’s best bet is to carve out a niche for itself—focusing on cost-effective production and specialized chips for key markets rather than trying to leapfrog the competition.
The odds of Intel catching up to these market leaders anytime soon are slim, tempering its long-term growth potential. This isn’t a stock for investors seeking explosive returns—it’s a Western asset fighting to regain financial stability. Turning the company around will take years, and reclaiming technology leadership by 2025 is highly unlikely.
Investors should manage expectations accordingly. Weak quarterly results could still drive the stock lower in the near term, but for those with patience, those dips could be buying opportunities. Intel remains a strategically important company, and its management is committed to seeing its turnaround through to the end.
Is Intel a Buy, Sell, or Hold?
Wall Street remains ultra-cautious and neutral on Intel stock despite the introduction of new management. INTC stock carries a Hold consensus rating based on one Buy, 27 Hold, and four Sell ratings over the past three months. INTC’s average price target of $23 per share implies approximately 7% downside potential over the next twelve months.
Conservative investors may find it appropriate to wait for yet lower entry points, but at today’s levels, Intel is worthy of consideration as a bargain basement buy.
Semiconductor Industry Prepares for Intel’s Comeback Trail
Some stocks are quick trades, and others require patience. Intel falls squarely into the second category. If Tan’s leadership brings the turnaround investors hope for, this could be one of the biggest comeback stories in semiconductor history. Right now, it might seem far-fetched to imagine Intel manufacturing processors for AMD and NVIDIA, but stranger things have happened in a sector known for outlandish developments.
For long-term investors willing to weather severe market volatility while keeping the bigger picture in mind, Intel presents a high-risk, high-reward opportunity. The path ahead isn’t clear-cut, but with Lip-Bu Tan at the helm, Intel has its best shot in years at regaining its commercial market footing. I remain cautiously optimistic—ready for the ups and downs and eager to see where this new chapter takes Intel.
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