While it might have baffled more than a few people to see chip stock Intel’s (INTC) former CEO out calling for prayer and fasting for the engineers formerly under his watch, the more you look at Intel’s current environment, the more it makes sense. And Intel is looking to build its future, even as new chips start working on the quantum level. But these future considerations may be too little too late, as Intel shares were down 3% in Tuesday afternoon’s trading.
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A report from Tom’s Hardware detailed how Intel hit the International Electron Devices Meeting’s (IEDM) 2024 conference to consider its future and noted quite a bit going on behind the scenes. Intel revealed new research for gate-all-around (GAA) transistor scaling, a vital development as it allows for processor sizes less than seven nanometers. These are considered the successors of current transistors, making them a crucial step forward in chip production.
Silicon Is Starting to Reach Its Limits
Further, Intel is also looking into processors that not only use “atomically-thin 2D transistors” but also “beyond-silicon” materials. This is vital, as a recent report from MIT’s Department of Materials Science and Engineering noted there were some signs that silicon was starting to reach its limits. More about these developments are likely to come.
Not that Intel’s current line is exactly a slouch; new reports from Techradar note that Intel’s Arc B580 GPU is delivering some downright staggering results. Recent Vulkan benchmarks noted that Intel’s new GPU not only beat the RX 7600 from AMD (AMD), but it also passed the RTX 4060 from Nvidia (NVDA), which is something of a feat given Nvidia’s specialization in that field. And given that Intel is poised to look more to “mid-range GPUs” that are delivering results like these, that could be a coup in the making.
But What About the Ohio Plant?
Meanwhile, after all the things that have happened to Intel of late, large portions of Ohio are starting to wonder just what will happen to that big new chip foundry that was supposed to go in and bring a slew of jobs with it. Word from NBC 4 is a bit unclear, but they took a look nonetheless.
Intel is still in line for the money from the CHIPS Act, noted word from the Department of Commerce, as Intel will still be producing chips in the United States. Certainly, it noted that “…evolutions and transitions in the industry are to be expected” but would have little bearing on the cash already awarded.
And, if, as some fear, Intel looks to divest its foundry operations, it will not be able to do that completely without ramifications to its CHIPS Act funding. Intel needs to own at least 50.1% of voting rights to continue to qualify if the foundry is a private company, and no other company can own over 35% if it goes public.
Is Intel a Buy, Hold, or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 22 Holds, and six Sells assigned in the past three months, as indicated by the graphic below. After a 54.16% loss in its share price over the past year, the average INTC price target of $24.43 per share implies 20.76% upside potential.
