Things are actually looking up for chipmaker Intel (INTC), as it is working on a new collaborative effort and potentially shutting down a fabrication project in Germany. The news was regarded as welcome by investors, who sent shares up nearly 3% in Monday afternoon’s trading. Intel kicked things off by announcing a collaborative effort with Karma Automotive, in which the duo would create a Software Defined Vehicle Architecture (SDVA) system that will help drive the automobile industry’s path forward toward sustainable vehicle development.
The SDVA system will help consolidate a car’s electrical systems; instead of using the standard approach of multiple electric control units, it will now use a centralized set of computing systems to manage the electrical operations. It will also help to improve battery usage levels, thanks to rerouting functions like camera monitoring to local controllers, a development that should be particularly useful when it comes to the electric vehicle market.
Trouble in Magdeburg
Meanwhile, in Magdeburg, Germany, there are signs that Intel’s cash crunch may be more pronounced than expected. Reports note that Intel might ultimately shutter plans for two new large chip fabrication labs in the region.
While Intel has long had a vested interest in developing fabrication facilities—which should make the Magdeburg project ultimately safe—there is no denying Intel has been cutting back lately and in wide swathes. The local government, therefore, is preparing a backup plan in case Intel pulls out of the current arrangement, looking for a new “anchor investor” in the wider industrial zone project.
What Is the Target Price for Intel?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 24 Holds, and five Sells assigned in the past three months, as indicated by the graphic below. After a 34.27% loss in its share price over the past year, the average INTC price target of $27.80 per share implies 29.79% upside potential.
