Shares of chip maker Intel (NASDAQ:INTC) are among the most-discussed stocks on the social media platform Reddit after the company delivered strong Q3 earnings. Thanks to its back-to-back strong earnings performance, INTC stock has risen about 25.5% year-to-date and outperformed the S&P 500 Index (SPX) with its returns. Given the decent gain in its price and competitive headwinds, Wall Street analysts’ average price target suggests a limited upside potential in Intel stock from current levels.
With this backdrop, let’s understand what’s in store for Intel shareholders in the future.
Should You Buy or Sell Intel Stock?
Intel’s third-quarter earnings exceeded Street’s expectations, indicating a continued improvement in its financials. Further, an expected recovery in the PC market and opportunities led by AI (artificial intelligence) bode well for growth.
Despite Intel’s improving financial performance, analysts have not changed their stance on INTC stock. Following the Q3 earnings, Goldman Sachs analyst Toshiya Hari maintained a Sell recommendation on Intel stock. The analyst expects Advanced Micro Devices (NASDAQ:AMD) to take market share from Intel within the traditional CPU market. Nonetheless, Hari increased the price target on INTC stock to $30 from $28.
Like Hari, Vijay Rakesh of Mizuho Securities also increased the price target on INTC stock. However, the analyst reiterated a Hold rating on Intel stock as he sees the company lagging Nvidia (NASDAQ:NVDA) in the data center and AI space.
Further, TD Cowen analyst Matt Ramsay and KeyBanc analyst John Vinh also reiterated a Hold recommendation on INTC stock following Q3 earnings print. Overall, Intel stock has received six Buy, 20 Hold, and four Sell recommendations for a Hold consensus rating. Moreover, the average INTC stock price target of $37.10 implies a limited upside potential of 14.08% from current levels.
The Takeaway
Intel is well-positioned to capitalize on the recovery in the PC market. Moreover, higher revenues led by an increase in average selling price are expected to cushion its margins. In addition, Intel’s Foundry Services will enable it to capitalize on the AI market opportunity.
However, market share losses to competitors, primarily AMD, continue to limit the upside potential in this trending Reddit stock, reflected through analysts’ Hold consensus rating.
