While chip stock Intel (INTC) has been facing a lot of issues in its day-to-day operations lately, one thing that seldom comes up is the active theft of Intel’s secrets. Yet that seems to be what came to light recently, as one of Intel’s engineers allegedly tried to land a host of Intel’s trade secrets. This was not good news for shareholders, either. They sent Intel shares down over 2% in Thursday afternoon’s trading.
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The engineer involved, Jinfeng Luo, apparently took two separate attempts to land access to what reports called “…a trove of Santa Clara computer chip giant Intel’s trade secrets.” The first attempt did not go well. The second attempt, reports suggested, delivered better results. Luo had been with Intel since 2014, and on July 7, was notified that he would be one of the many, many people that Intel was laying off.
Eight days before his termination date, Luo allegedly plugged in an external hard drive in a bid to take some trade secrets home with him. The first attempt was caught by internal controls. The second attempt, though, featured a “network storage device,” which was able to move the material. Luo allegedly pulled around 18,000 files, some of which were explicitly marked “Intel Top Secret,” reports noted. Intel took aim at Luo, and is seeking “…at least $250,000 in compensation from him.”
“Let’s Just Be Very Careful”
That was when Jim Cramer of CNBC fame came out to say a few words about Intel, when asked if the money that could be made in Intel stock had already been made, or if there was still room to grow. Cramer was less than enthusiastic about Intel’s near-term futures.
Cramer noted, “It’s too late. Money’s been made. Let’s just be very careful. The stock’s had a gigantic move. There are many people who say that there’s still so much work to do. You’re going up against some very big companies.” All of which is true, though Cramer does see some potential that new CEO Lip-Bu Tan can turn things around at the struggling chipmaker. Still, though, he ended with an even more cautious note: “The problems aren’t over yet.”
Is Intel a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on three Buys, 24 Holds and six Sells assigned in the past three months, as indicated by the graphic below. After a 46.32% rally in its share price over the past year, the average INTC price target of $35.44 per share implies 5.68% downside risk.
