In This Article:
What Happened?
Shares of computer processor maker Intel (NASDAQ:INTC) jumped 6.6% in the pre-market session after Reuters reported that Broadcom and Nvidia are running tests on Intel's 18A manufacturing process, highlighting the company's (INTC) progress and the potential to attract high-caliber customers. With high expectations surrounding Intel's Foundry business, these updates lend credibility to the growing hype, and even the speculation about a potential acquisition of the unit, suggesting there may be real substance behind it.
The shares closed the day at $22.77, down 4.3% from previous close.
Is now the time to buy Intel? Access our full analysis report here, it’s free.
What The Market Is Telling Us
Intel’s shares are very volatile and have had 27 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 13 days ago when the stock gained 10.5% on the news that The Wall Street Journal reported that the company was in talks with Broadcom and TSMC to sell certain assets. Sources revealed Broadcom was interested in Intel's product business, while TSMC was more focused on snapping up and controlling some of its factories. Investors were betting on management to make a move to unlock value in some of its operating segments, given the significant investments that have been made in recent years. The stock's reaction suggests the market sees real potential in a deal with industry peers like Broadcom and TSMC, both leaders in chip design and manufacturing.
Intel is up 13.3% since the beginning of the year, but at $22.92 per share, it is still trading 50.3% below its 52-week high of $46.15 from March 2024. Investors who bought $1,000 worth of Intel’s shares 5 years ago would now be looking at an investment worth $409.16.
Unless you’ve been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefiting from the rise of AI. Click here to access our free report on our favorite semiconductor growth story.