Much like Wile E. Coyote suddenly running off a cliff and not falling until he noticed there was nothing underneath his feet any longer, Intel (INTC) lost quite a bit of ground today after initially rising earlier this week despite a chip sector-specific downturn. With reality asserting itself, Intel fell over 5% at the time of writing
The big reason why reality caught up with Intel is simple: CrowdStrike (CRWD). The massive outage that struck the cybersecurity provider hit Intel, which supplies many of the processors that run the hardware at CrowdStrike. That kind of negative halo effect sent shares into open decline.
While there’s not much evidence to specifically link the processors to the security flop, the association apparently was enough to make people think these systems are oddly delicate and thus prompted a departure from a potentially risky stock.
Not the Image Intel Wants to Portray Right Now
That perception of delicacy comes at a terrible time for Intel, as it’s still fighting off issues from its CPUs and their stability. In fact, reports note the problem is worsening, as it’s recently extended to laptops. What was previously thought a problem for desktops alone is now showing up in more mobile devices. This is causing customers to move away from Intel, such as Alderon Games who’s looking to trade in its Intel hardware for AMD (AMD) chips.
In addition, there’s word that the next generation of desktop chips from Intel may have a bit of a heat problem. Reports suggest they could ultimately run just as hot as laptop chips from the Meteor Lake lineup. Both Arrow Lake and Panther Lake will have a max temperature of 105 degrees Celsius, after which point the chips will start automatically throttling to cool off.
Is Intel a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on three Buys, 24 Holds, and three Sells assigned in the past three months, as indicated by the graphic below. After a 0.36% rally in its share price over the past year, the average INTC price target of $38.02 per share implies 14.76% upside potential.
