Intel (NASDAQ: INTC) traders are having a fairly nice week thus far — even when Intel inventory is not but displaying it. The Wall Road Journal reported Wednesday that the U.S. Commerce Division awarded Intel $8.5 billion in subsidies to assist defray the price of increasing semiconductor manufacturing in Arizona, New Mexico, Ohio, and Oregon.
This implies totally 16% of the $53 billion in authorities cash licensed by the 2022 “Chips Act” will go to Intel alone. World Equities Analysis analyst Journey Chowdhry is wanting on the information positively and, on Thursday, he raised his worth goal on Intel inventory to an enormous, fats $100.
Is Intel inventory a purchase?
Contemplating Intel inventory prices roughly $42 as we speak, that is an enormous vote of confidence. Chowdhry’s worth goal implies this $182 billion firm will greater than double in worth over the following 12 months or so. What has him so enthused?
Effectively, $8.5 billion in free authorities cash is an efficient begin. However past that, Chowdhry says Intel is the one firm as we speak that may construct the sort of power-efficient “subsequent era” 18A and 14A synthetic intelligence processors wanted to maintain the AI revolution going. (“18A” refers to each the dimensions of the processor — 1.8 nanometers — and in addition its 3D stacked format).
Whereas different corporations corresponding to Superior Micro Units and Taiwan Semiconductor Manufacturing are additionally exploring 3D stacked chips, Intel seems to be the chief. Mixed with smaller chips and larger energy effectivity, 3D structure could also be sufficient of a differentiator that, when a little bit of free authorities cash is added, Intel can flip itself round this yr, then outgrow its rivals in years to return.
That mentioned, there are dangers. For one, $8.5 billion solely covers about half of the $14.3 billion in money Intel spent final yr on growth — and free money move is anticipated to stay adverse by means of 2026. $100 a share can be an aggressive worth goal for an organization that earned solely $0.40 per share final yr, implying a trailing P/E ratio of 250!
Caveat investor.
Do you have to make investments $1,000 in Intel proper now?
Before you purchase inventory in Intel, think about this:
The Motley Idiot Inventory Advisor analyst workforce simply recognized what they consider are the 10 finest shares for traders to purchase now… and Intel wasn’t one among them. The ten shares that made the lower might produce monster returns within the coming years.
Inventory Advisor supplies traders with an easy-to-follow blueprint for fulfillment, together with steerage on constructing a portfolio, common updates from analysts, and two new inventory picks every month. The Inventory Advisor service has greater than tripled the return of S&P 500 since 2002*.
See the ten shares
*Inventory Advisor returns as of March 21, 2024
Wealthy Smith has no place in any of the shares talked about. The Motley Idiot has positions in and recommends Superior Micro Units and Taiwan Semiconductor Manufacturing. The Motley Idiot recommends Intel and recommends the next choices: lengthy January 2023 $57.50 calls on Intel, lengthy January 2025 $45 calls on Intel, and brief Might 2024 $47 calls on Intel. The Motley Idiot has a disclosure coverage.
Is Intel Inventory Going to $100? 1 Wall Road Analyst Thinks So. was initially revealed by The Motley Idiot