Analyst Vivek Arya of Bank of America Securities reiterated a Hold rating on Intel, retaining the price target of $25.00.
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Vivek Arya’s rating is based on the current uncertainties surrounding Intel’s manufacturing capabilities, particularly the 18A process yields and the engagement with external customers. The company faces significant challenges in closing its manufacturing gap with TSMC, its AI portfolio gap with GPU and ASIC competitors, and its CPU market share gap with AMD and ARM-based rivals. Arya believes that government intervention or new investors are unlikely to address these core issues and might even distract Intel’s management from achieving their immediate goals.
Furthermore, while there are discussions about the U.S. government potentially taking a non-voting equity stake in Intel, this move could lead to a dilution of existing shareholders without providing immediate benefits. Additionally, the strategic stake taken by Softbank is seen as a positive development, but not a transformative one, given the existing partnerships Softbank has with other suppliers. Ultimately, Arya emphasizes that Intel’s future hinges on its ability to demonstrate competitive manufacturing capabilities, particularly with its 18A process, to regain market share and attract fabless customers.
INTC’s price has also changed slightly for the past six months – from $26.090 to $23.540, which is a -9.77% drop .