Semiconductor company Intel (NASDAQ:INTC) could receive over $10 billion in subsidies from the U.S. government under the CHIPS and Science Act, Bloomberg reported. Per the report, the Biden administration is currently in talks regarding allocating funds to Intel. The subsidy package under consideration is expected to include both loans and direct grants.
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This comes when Intel is reportedly delaying the construction of its chip manufacturing project in Ohio, citing market challenges and the slow disbursement of grants from the U.S. government. Initially scheduled to begin production next year, the construction of the manufacturing facilities is now expected to extend until late 2026.
Intel is poised to reap significant rewards from the CHIPS and Science Act, having pledged billions towards establishing new chip manufacturing facilities within the U.S. Notably, in 2021, Intel announced more than $43.5 billion in new manufacturing investments across Arizona, New Mexico, and Ohio. These investments aim to strengthen semiconductor production and support research and development efforts in the United States.
What is the Prediction for Intel Stock?
Intel stock has gained over 69% in one year, outperforming the S&P 500’s (SPX) gain of around 25%. The tailwinds from artificial intelligence (AI) and an expected recovery in the PC market provide a solid platform for future growth. Nevertheless, analysts remain cautious due to increased competition.
INTC stock has seven Buy, 24 Hold, and four Sell recommendations for a Hold consensus rating. The average price target of $46.42 implies 6.69% upside potential from current levels.
