Intel Stock Could See Significant Upward Momentum, Analyst Predicts
Analyst Predicts Potential Surge in Intel Stock
According to a recent report from Lynx Equity Strategies, Intel (NASDAQ:) stock may be on the brink of a substantial upswing, with the potential for a 20% to 30% increase, driven by what they call ‘significant’ catalysts.
Lynx Equity Strategies informed investors that they anticipate a tactical rise in Intel’s stock, propelled by the aforementioned catalysts.
“In a market where AI innovation is highly sought after, even minor positive catalysts could have a major impact on stock performance,” the firm noted.
The first catalyst identified is Intel’s upcoming event on April 2nd, where the company plans to unveil its new reportable segments.
“This event, typically mundane, could hold more excitement this time around,” Lynx Equity stated. “We anticipate a restructuring of business groups and insights into the CHIPs act funds.”
Moreover, they predict that the company will announce a reorganization of business groups leading to “hopefully, improved transparency.”
With the CHIPs act funds now settled, Lynx Equity expects Intel’s CFO to outline the details and timing of these funds and how they will support the ‘smart capital’ initiative, potentially boosting the FCF outlook.
The second catalyst highlighted is the launch of Sierra Forest in the first half of 2024.
“Despite minimal investor enthusiasm for the launch of this ~300core server chip, we believe there is an AI element to Sierra Forest at Meta), distinct from Gen AI workloads,” the firm mentioned.
They added: “Additionally, we speculate that Sierra Forest could begin shipping in early 2Q.”
Intel’s Potential as a Major AI Player
There are signs that Intel’s strategic moves in the AI sector and recent funding awards position the company to emerge as a key player in the AI market, benefiting from the growing adoption of AI technologies.
Analysts at BofA Securities shared insights from a recent investor dinner with Intel executives, highlighting the company’s enterprise AI prospects leveraging its strong market position.
However, Needham & Company recently downgraded Intel shares to Hold from Buy, citing concerns about the company’s performance, including aggressive PC TAM estimates and a potentially lengthy AI PC upgrade cycle.
Additionally, when reports emerged about Naver replacing Nvidia’s H100 with Intel Sapphire Rapids and AI accelerators, Bernstein analysts noted that while it is a significant move, it may not be a game-changer just yet.
“Switching from GPU to CPU may be costly for AI tasks, especially LLM model training,” the Wall Street firm explained.
