Intel (NASDAQ:INTC) stock has been getting little love on Wall Street for a while now. The company can’t seem to put a foot right. It has had manufacturing delays, has been losing share to AMD in the CPU market, has seen no benefits from the AI-driven rally and its most recent quarterly readout was nothing short of woeful.
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Most market watchers don’t see Intel’s fortunes shifting anytime soon and are predicting more difficult times ahead for the fallen chip giant.
However, there are often contrarians on Wall Street willing to stick their neck out and take a bold view that goes against the grain. For Intel, that is currently Northland’s Gus Richard, an analyst who ranks amongst the top 2% of Wall Street stock pros.
That said, it’s not as if Richard has high praise for Intel. In fact, the analyst pointed out that the company “has not modernized its internal design methodology” and that its products “are late and perform poorly.” It also doesn’t have the reusable IP blocks crucial for streamlined product development. Instead, they have IP blobs which are “difficult to reuse.”
So, why is Richard pounding the table here? It’s simple, really.
“INTC is a strategic Company for the DoD, as it needs its supply chain to be based on US soil. There is no alternative to INTC as a second source to TSMC in leading-edge logic. For these reasons, we believe the Daddy War Buck (US Government) will continue to provide funding to the Company,” Richard explained.
Intel has been getting work from the U.S. military and recently struck a $3.5 billion deal to make chips for it. And according to a recent report in the Financial Times, the company is expected to secure $8.5 billion in direct funding from the U.S. government by year-end. This funding is part of the CHIPS and Science Act’s initiative to strengthen domestic semiconductor production.
To this end, Richard rates Intel shares a Buy while his $42 price target implies the stock will gain 85% over the next 12 months. (To watch Richard’s track record, click here)
As mentioned, on Wall Street, Richard’s positive take on INTC is unique. Of the 33 other recent reviews, 26 say Hold while 7 recommend to Sell, all culminating in a Hold consensus rating. That said, the $25.47 average price target implies the stock will climb 12% higher over the next 12 months. (See Intel stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
