Chip stock Intel (NASDAQ:INTC) has had a rough run of things lately. With several competitors stepping in on territory it formerly held largely to itself, and a market in a general state of decline, it wasn’t looking good for a while there. However, Intel gained fractionally in Monday afternoon’s trading session, despite some clear concerns out of analysts.
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The unkind words for Intel emerged from Robert W. Baird, where analysts Tristan Gerra and Tyler Bomba took aim at the beleaguered chip maker. While there were some positive signs—the duo cited a “…revenue and gross margin recovery…” in which Intel was “well-entrenched,” there was potential trouble ahead. The duo noted that the big issue was “…how much momentum is left,” citing a fairly stable overall market for PCs and declining growth in the entire x86 concept for data centers. Moreover, Baird also saw potential trouble ahead for Intel in getting its new node production up to snuff.
Though the Baird analysts aren’t out of line, there is evidence that Intel is fighting back against potential losses in formerly key markets. For instance, Intel is working to improve its Xeon line of chips with “AI Inference,” a system that allows AI training to go much smoother—and much less expensively, by extension—than used to be the case. And even as several major competitors come looking for a slice of Intel’s PC pie, Intel is already working to expand outward into foundry operations, a move that would render the competition comparatively moot as they would turn to Intel’s foundry operations to create their competing chips in the first place.
Is Intel a Buy, Hold, or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on three Buys, five Holds and one Sell assigned in the past three months, as indicated by the graphic below. Furthermore, the average INTC price target of $37.45 per share implies 4.55% upside potential.
