It was a great day for Inter.Nasdaq:INTC), which is something you don’t hear much about in this chip stock. But competitor Advanced Micro Devices (Nasdaq:AMD) was enough to send the stock soaring more than 5% in afternoon trading on Monday.
Intel has not made any significant progress in the artificial intelligence (AI) space recently, and Nvidia (NASDAQ:NVDABut a new report from analysts at Melius Research suggests things may be looking up in the second half of the year. Melius calls Intel an “AI laggard” for the first half of 2024, which might be a bit of good news.
Melius noted that a similar scenario could play out in 2023, with so-called “underdogs” faltering in the first half, only to realize their shortfall and come back strong in the second half. And while many analysts say past performance is no indicator of future performance, most realists believe it’s the only realistic measure we have available.
AMD Pros and Cons
Meanwhile, AMD has some interesting news that could go either way. First, there were concerns about the Ryzen 9 9900X chip. This next-gen Ryzen chip is said to be powerful enough to make Intel nervous. In fact, the 9 9900X is 10.1% faster than the Intel Core i9-14900K, which is certainly cause for concern.
However, there was a positive development for Intel, as AMD’s major advantage in outsourcing manufacturing may clearly be eroding. Indeed, Intel is becoming less resistant to outsourcing manufacturing, while at the same time seeking to improve its foundry capabilities. This means AMD must rush to disrupt the status quo and build new strengths or risk falling behind.
Should you buy, sell or hold Intel?
Turning to Wall Street, analysts have a consensus rating of Hold on INTC shares based on 3 Buys, 25 Holds, and 3 Sells in the past three months (see chart below). The average price target for INTC is $38.02 per share, suggesting an upside potential of 12.45%, after the stock price has risen 4.6% over the past year.
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