Intel (NASDAQ:INTC) is divesting a substantial portion of its investment in Mobileye Global (MBLY), a prominent self-driving technology company. Specifically, Intel’s subsidiary, Intel Overseas Funding Corporation, is set to sell 35 million shares, amounting to an approximate stake worth $1.5 billion in Mobileye Global.
Additionally, Intel has given the underwriters, Goldman Sachs (GS) and Morgan Stanley (MS), an option to purchase an additional 5.25 million shares of MBLY. Following the completion of the offering, Intel’s voting stake in Mobileye is expected to decrease from its current position of 99.3% to approximately 98.7%.
Interestingly, Intel is expected to use the proceeds to fund its plans to increase production levels. INTC CEO Patrick Gelsinger announced the ambitious growth plans in early 2022 in response to Intel’s declining revenues and margins. Additionally, intensified competition from rivals like Advanced Micro Devices (AMD) has led to Intel experiencing a loss in market share.
The growth plan includes the introduction of five new advanced manufacturing nodes between 2021 and 2025. During the release of the fiscal first-quarter results on April 28, Gelsinger reassured that the company is progressing according to plan, reaffirming Intel’s commitment to achieving its growth objectives.
Is Intel a Buy or Hold?
Among the 24 top Wall Street analysts giving ratings on INTC stock, four recommend a Buy, 16 suggest a Hold, and four have given a Sell rating. Thus, top analysts are sidelined on Intel with a Hold consensus rating. Further, the consensus 12-month price target of all top analysts of $30.90 implies an upside potential of 3.5%.
It is noteworthy that these top analysts have an impressive history of helping investors generate massive returns from their recommendations. Moreover, each analyst has a remarkable success rate.
