Intel’s (NASDAQ:INTC) efforts to start chip production at its Ohio plant are facing challenges due to the tough market dynamics, as reported by the Wall Street Journal. The semiconductor giant is now delaying the construction of its chip-manufacturing project in Ohio, citing market difficulties and the slow disbursement of grants from the U.S. government.
Originally slated to commence production next year, the construction of manufacturing facilities is now expected to extend until late 2026.
Notably, Intel had initially disclosed plans for an investment exceeding $20 billion in constructing two cutting-edge chip factories in Licking County, Ohio. This significant investment was intended to strengthen domestic production, meeting the rising demand for advanced chips in the U.S.
What is the Prediction for Intel Stock?
Intel stock appreciated about 47% in one year, outperforming the S&P 500’s (SPX) gain of around 16%. The rapid adoption of Artificial Intelligence (AI) by all industries is proving to be a significant tailwind for the company. Moreover, the expected recovery in the PC market augurs well for growth.
However, analysts’ Hold consensus rating, based on seven Buy, 24 Hold, and four Sell recommendations, suggests that these positives are already reflected in INTC’s share price. Further, heightened competition in the traditional CPU market from Advanced Micro Devices (NASDAQ:AMD) poses challenges.
While analysts remain sidelined, their average price target of $46.42 implies a limited upside potential of 7.06% over the next 12 months.
