Intel (NASDAQ:INTC) has recently been swept up in a whirlwind of market-moving events, from the unveiling of Project Stargate and the DeepSeek revelations to rumors of a potential Elon Musk-led acquisition of the company.
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Musk is no stranger to making headlines, and the rumored interest of the world’s richest man in the embattled Silicon Valley giant makes a certain kind of sense. The common denominator connecting his numerous ventures is technological innovation, and any such deal would likely foster partnerships across his business empire.
For Intel shares, which have taken a beating over the past year, this development could offer a welcome reprieve.
However, one top investor, known by the pseudonym JR Research, is not buying the buyout rumors.
“The lack of follow through since the revelation last week is telling, suggesting we should not give too much ‘weight’ to such indications,” warns the investor who is among the top 2% of TipRanks’ stock pros.
JR further explains that Musk has also been linked with a potential purchase of TikTok, which has a more obvious synergy with the “X” social media platform. Moreover, the potential acquisition of TikTok is a more pressing political issue that fits with President Trump’s agenda.
Doubtful that a buyout is forthcoming, JR provides additional reasons to take a cautious stance on Intel at present. Among other challenges to its businesses, this includes an inability to make inroads against the market-leading Nvidia.
“Intel’s poor execution on the AI front has seen the company failing to capitalize on the massive switch to accelerated computing, giving Nvidia near complete market dominance,” states the investor.
That said, it’s not all doom and gloom. JR recognizes signs that a recovery could be on the horizon, especially with indications that Intel’s PC and notebooks are selling better than expected.
Still, the investor is not quite ready to pull the trigger prior to the company’s Q4 2024 print (scheduled for tomorrow, January 30 after the market closes).
“The risk/reward in the stock remains relatively well-balanced as we head into its upcoming Q4 release,” concludes JR, assigning Intel shares a Hold (i.e. Neutral) rating. (To watch JR’s track record, click here)
Wall Street is fully content to remain on the sidelines for now as well. With just one Buy, 23 Holds, and 4 Sell ratings, Intel holds a consensus Hold recommendation. However, its 12-month average price target of $23.58 suggests a potential 19% upside over the next year. (See INTC stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
