Analyst Vivek Arya from Bank of America Securities reiterated a Hold rating on Intel (INTC – Research Report) and decreased the price target to $23.00 from $25.00.
Vivek Arya has given his Hold rating due to a combination of factors impacting Intel’s current and future performance. While the new CEO, Tan, is making strategic moves to refocus on innovation and streamline operations, Intel’s substantial size and ongoing challenges in its manufacturing sector pose significant hurdles. The company faces stiff competition from both established and emerging players like AMD, TSMC, NVDA, and ARM, which complicates its recovery efforts. Additionally, financial obligations to co-investment partners and a challenging tariff environment contribute to the near-term headwinds.
Despite these challenges, Arya acknowledges Intel’s strong position in the enterprise sector, which could be advantageous during upcoming cycles such as Windows 11 and AI upgrades. The forthcoming “Foundry Connect” event may also present new partnership opportunities that could benefit Intel in the long term. However, persistent issues such as low gross margins, a weak balance sheet, and reliance on external manufacturing partners remain concerns. These factors collectively justify the Hold rating, as Intel’s turnaround is expected to be a multi-year endeavor with limited immediate catalysts.
Arya covers the Technology sector, focusing on stocks such as Nvidia, Intel, and Marvell. According to TipRanks, Arya has an average return of 9.0% and a 45.86% success rate on recommended stocks.