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We came across a bullish thesis on Intel Corporation (INTC) on Substack by DeepValue Capital. In this article, we will summarize the bulls’ thesis on INTC. Intel Corporation (INTC)'s share was trading at $19.57 as of April 7th. INTC’s trailing and forward P/E were 88.08 and 43.67 respectively according to Yahoo Finance.
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Intel (INTC), once the undisputed leader in semiconductors, now stands at the center of a transformational opportunity as AI, supply chain reshoring, and massive infrastructure investments reshape the tech landscape. With a market cap of $97.81 billion and shares trading near $22, the company is widely overlooked despite a compelling narrative emerging under new leadership. Intel operates across five key segments: Client Computing, Data Center & AI, Network & Edge, Foundry Services, and Other, with notable subsidiaries like Altera and Mobileye expanding its reach into specialized chips and autonomous driving. While its core business powers everything from personal computers to cloud infrastructure and smart factories, it is Intel’s positioning in AI inference and domestic chip manufacturing that makes the story particularly compelling today.
As AI usage shifts from training to inference, demand is moving toward efficient, cost-effective chips—Intel’s domain. Meanwhile, rising tariffs and geopolitical risks are incentivizing domestic production, a trend Intel is well-positioned for, having secured $7.86 billion in U.S. government grants to build out its foundries. With $5.66 billion of those grants still pending, the company’s plan to begin high-volume chip production by 2025 is timely. At the helm is Lip-Bu Tan, the transformative former CEO of Cadence Design, who turned around that company post-2008 and generated over 3,000% shareholder returns. His leadership now guides Intel through cost cuts—targeting $10 billion in savings by 2025—and a shift toward efficiency, including a promising new 18A chip that boasts industry-leading performance per watt.
Further supporting the bull case is a looming PC refresh cycle driven by aging pandemic-era hardware and the rise of AI-capable PCs. Despite Intel’s recent revenue decline—down 31% since 2021—the company historically commands a 19% free cash flow margin and currently trades at roughly 9x normalized FCF, offering a strong value proposition. Intel’s stock is down nearly 70% from its 2021 highs, but many of the structural issues—such as bloated operations and market share losses—are actively being addressed. If Intel executes on its roadmap, hits $100B in revenue with 20% margins by 2030, and trades at its historical 17x multiple, it could deliver a 3.5x return, or 27% CAGR. A more bullish scenario suggests up to a 5x return. Either way, Intel’s comeback is not just possible—it may already be underway.