Intel (INTC) is struggling despite the opportunities presented by the rise of AI technology. The stock has been on a downward trend, dropping from $45 to $30 per share in March and April. The company’s turnaround plans, which hinge on becoming a major chip foundry, are not expected to materialize until the end of the decade. Additionally, Intel’s recent quarterly results showed a revenue miss and disappointing guidance for the current quarter, leading to a downgrade by investors.
While there have been some positive developments, such as news of Intel’s global chip manufacturing capacity expansion, the stock remains on a long-term downward trajectory. Analysts expect Intel’s earnings to nearly double in 2025, driven by growth in the AI-PC chip market. However, competition from companies like Apple and potential trade war headwinds could impact Intel’s success in this market and lead to lower-than-expected returns.
Investors are reevaluating Intel’s valuation, with the possibility of more declines in the short term and in the long term. The stock may fall back to multi-year lows of around $20 per share, and it could underperform its peers in the coming years. Given the uncertain outlook for Intel, holding a position in the stock may not be advisable.
As of now, Intel receives a D grade in Portfolio Grader. Neither Louis Navellier nor the InvestorPlace research staff member responsible for this article hold any positions in the securities mentioned. In conclusion, Intel stock faces challenges despite the potential of AI technology, and investors should approach with caution.
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https://investorplace.com/market360/2024/05/intel-stock-is-an-ai-play-you-can-skip-out-on/