While it’s clear that there’s a lot going on in Israel right now, and everywhere in the region, there are some signs it may be spilling over into larger business operations. In fact, the latest reports suggest that there may be plans for chip maker Intel (NASDAQ:INTC) to halt a new factory planned for Israel. Investors, meanwhile, seemed reasonably pleased with the notion, sending shares up fractionally in Tuesday afternoon’s trading.
Reports suggested that the plans would be put on hold not due to any kind of geopolitical issues or outright war but rather the need to “adapt big projects to changing timelines,” according to a Reuters report. Intel wasn’t giving up on Israel—a statement from the company called Israel “…one of our key global manufacturing and R&D sites…” while also noting, “…we remain fully committed to the region”—but was just pulling back on its plans a bit.
Given that the Israeli government gave Intel a $3.2 billion grant to help build its planned chip plant—which had a price tag of around $25 billion—it’s a safe bet that the plant will go in, at least eventually.
Casting Doubt on the Doubt
However, a different report suggests that the whole issue may have a much simpler explanation. Business news site Calcalist noted that Intel was changing its building contractor for the planned expansion and included word from senior government officials that said there were no changes in the planned investments.
Intel also followed up on this one, noting—as previously seen—that it wasn’t so much a stop as it was a small delay. The grant from the Israeli government, coupled with the construction of a $900 million power plant in the area to help keep it running, certainly makes the chances of a full stop to the plans seem remote at best.
Is Intel a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on three Buys, 26 Holds, and three Sells assigned in the past three months, as indicated by the graphic below. After a 5.08% loss in its share price over the past year, the average INTC price target of $38.02 per share implies 22.76% upside potential.
