Is Intel's (intc) Stock A Buy Despite Their Messy Situation?
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- Опубликовано: 15 июн 2024
- This episode of Chip Stock Investor discusses Intel's current position in the semiconductor industry and its plans for a turnaround. Nick and Kasey explain Intel's financial underperformance compared to the SOXX ETF and other chip stocks, and detail Intel's shift towards a new financial model by disclosing details on Intel Products and Intel Foundry.
Nick and Kasey especially analyze the losses reported by Intel's Foundry segment and the challenges Intel faces in catching up with TSMC's advanced chip production.
The conversation covers Intel's strategies to scrounge up cash such as re-IPOs for fab construction, funded in big part by the U.S. CHIPS Act and European Chips Act, to regain manufacturing technology leadership.
With the ambitious plan, will Intel be a stock to buy for Chip Stock Investor?
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Chapters:
00:00 Intel's Semiconductor Saga
03:34 The Strategic Shift: Intel's Business Model Transformation
05:19 Financial Struggles and the Path to Recovery?
10:43 Intel's Ambitious Manufacturing Projects and Funding Challenges
15:08 Investment Considerations: Opportunity Costs and Valuation Insight
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I bought NVDA shares at $300, $475 and 300% up, I kept adding in the managed holdings. I believe NVDA is at least 5 years ahead in innovation. I wouldn't be surprised if they keep going higher.
Nvidia hitting the scene so far! You definitely crushing it..
Spot on! How effective is your managed tradings and which stocks wave should I consider on my fidelity right now?
Stocks is not only about anticipating moves based off trends but anticipating through participating behind real top performers and attain how they execute perfectly.
coach Frost hilda take good care of my holdings giving me an edge to successful interest.
l've been getting suggestions to use a proper enlightened top tier, similar to your viewpoint.
I’m trying to figure out your selected holdings at the moment
I currently own tech equities and ETFs constructively, having gained full insight. In terms of price to earnings ratio (P/E ratio) NVDA, AMD and few others has been my main growth drivers in my holdings. Feel free to imitate my steps with a high achiever.
Intel will have to build up its production as quickly as the usual Intel processors lose importance. But, the USA will not drop Intel...same as GM.
Here in Germany, Intel is welcomed with a lot of subsidies. 🎉I believe in the turnaround. 😉
Not just USA. The west needs to divert manufacturing from Taiwan to the west. There is Global Foundries but the Arabs own it. It would like letting Lockheed Martin or Raytheon fail.
Surely it will.. but have patience of 5 years
I'm going to be making very small DCA adds for this time Intel is in the hinterlands. It does seem that Intel has a interesting future, but i agree with everything in your video. TSMC is a juggernaut.
I am buying Intel forever. Was 50% up, now 35%, but am not taking it in my head. Intel for long term.
I exited the stock a year ago, only way Intel is achieving #1 in the foundry throne is if things really really heat up in Taiwan geopolitically. Even with the AI boom there is a big risk of a glut of fab capacity, with all the buildouts going around the globe, and with Intel finacially "betting the farm" (statement as per Gelsigner) with their entry into the foundry market and massive buildout its all quite risky. To recoup the costs of a fab it has to run at near full capacity for quite some time. And with global economic slowdown rearing its head that may not be a certainty. When you add all these risks plus intels disadvantage being a newcomer to the foundry business relying on a partnership with UMC to help them out, things just don't look particularly optimistic. Building chips for other companies is very different than building chips for themselves.
Asianometry has gone in depth regarding TSMC's numerous "nearly" inherent advantages regarding red tape, workforce, and operating costs, and the differences between IDM and a contract foundry. I'd suggest watching his videos on TSMC.
We are already seeing the redtape/inefficiencies of building fab capacities in US (Intel's home turf) which is going to saddle Intel going forward, as Japan's new TSMC fab is now completed before Intel's despite Intel's multi years head start in its effort to build new fabs.
About 28% now…just one week after…you see no more loses the coming month?
@@WorldCollections It might go more down. But I take that as an opportunity to buy and hold more. I go for long term. If you need your money now, don’t invest in it. I am just around 34 and will keep buying and holding till retirement. So short time ups and down don’t matter much to me. I will ride the flow. 😅
What made you so confident about intel, it hasn't been performing for the past 20 years? Lower than price in 2000 now
@@shahriazshaon4300 Long term looks potentially risky for Intel as well (not sure what happened to my other reply to you).
The Chinese government has made it clear that it is getting ready to go after Taiwan militarily in a few years. What happens to all the semiconductor companies that are highly dependent on TSMC at that time? It is likely like there will be a blockade of Taiwan with no semiconductors leaving the island. It is likely TSMC foundries will be damaged by accident or on purpose and will remain unproductive for a long time. I think Intel will have plenty of customers begging for foundry production allocations when that scenario finally happens.
Apparently you've never heard of the U.S. Navy
@@xCAPTSTONERB91x The Chinese are building new warships like crazy precisely to deal with the U.S. Navy.
You can't have an investment thesis based upon a war, and then on top of that TSM foundry will be damaged. The former is unlikely, and latter is predicted on the former for which PRC will be careful not to damage. PRC would want to takeover TSM (factory, technology, and personnel). Even if this war happens, what makes you think the business will go to INTC? PRC is also making progress in Fab, independent of TSM and ASML. PRC is likely to leapfrog both TSM and INTC. Having said all this, I am an investor in both INTC and TSM. I think INTC foundry will flourish in 3-4 years.
@@xCAPTSTONERB91x Apparently you have never heard of the possiblitly of WW3 no nation is willing to take because of a small island.
I don’t get this argument. Tsmc is building fab in the US as well and gets compensation from government just like intel. They will still be manufacturing in US. So why people bother whether Taiwan annexed by China or not?
I worked in Intel for 11 years. Sold most Intel stock around 60$ I waiting for better price to sell rest of the stock.
Warren Buffett basically said never underestimate the power of a popular American franchise.
The big question is whether Intel still commands a strong franchise. The Intel chapters of "Value Investing: From Graham to Buffett and Beyond" have a great discussion about that. IBM also had a strong server franchise when Intel started dismantling it... there are many signs Intel's franchise is currently broken with AMD, NVidia and Apple being stronger franchises which are eating their lunch. Can they fix it?
@@GustavoNoronha only time will tell my friend. With the potential of more wars and lines being drawn in the sand between china, russia, and the US i bet intel will make a come back. Specially with their foundry business.. also Intel has decades upon decades of intellectual property and resources. I’m sure can easily get them back on track.. the financial fundamentals will be Rocky for a while, but does not mean there is no value there
@@GustavoNoronha Higher prices don't mean better stock. I think Intel will be around forever, and as for the current pump, AI will go down in the coming months just for everything to do exactly what it's doing now again... Intel is down 40% - 50%, and you think that it's not a buy is crazy.
It's worth noting that the government heavily relies on Intel for its technological needs. This trust and dependence speak volumes about Intel's reliability and future prospects.
Because, at this point, they can't switch to AMD...
Anyway can't wait to see what happens...
@@Justinthepenguin a stock is only a good buy after going down 40-50% if its intrinsic value is quite a bit higher than what it trades at after that drop.
If you look at Nokia, for instance, who was the dominating player in the smartphone market before being crushed by the iPhone and Android, you'll see what I mean.
The US government is unlikely to let the fabrication side of Intel fail, I agree there, but that does not mean it will save the design side - which is the only one making money right now, but coming under heavier competition every quarter.
It also does not mean they will save the equity investors if push comes to shove...
You say Intel is reliable and trusted, but that is far from the truth, just look at the Aurora super computer saga. Read up on its history - Intel effectively gave that to the government for free after massive delays, and still massively underdelivered on the promises - it's a much less efficient and performant system than it should have been. AMD and NVidia on the other hand have been delivering, sometimes overdelivering.
Intel won't die, there we agree. What will it look like if it doesn't manage to compete in design, though? Is it really a 140B market cap company or is it more like 5B one, like AMD when it came quite close to dying?
There are no certainties here for equity investors, keep that in mind.
Intel stock is a safe investment as the government will back them in the event they are near bankruptcy. They are not going away anytime soon.
Love the opportunity cost argument added in. Even if this dog INTC recovers some day how much did I lose by not investing elsewhere? Keep up the good work!
Thanks Steve, hope you found it helpful!
Great video analysis of Intel Nick and Kasey. I am American and I want to support Intel to establish more chip fabrication factories on its homeland to be competitive with the rest of the world. However, I am looking to get in at a good price and invest for the long haul such as ten years. I am waiting for a new low Intel stock price to get in at a discount....
May be do DCA. Time in the market is better than timing the market.
To add, doesn't mean I am betting on Intel but I wouldn't write them down either.
Let's see how this evolves the next years
INTC is in a list of potential turn around stocks. Lots of doubts along the way. The strategic plan might not succeed but if Pat Gelsinger succeeds in reviving Intel into greatness, he will probably go into the books of legendary corporate turn arounds. Don't dismiss his past as great engineer, and Andy Grove'S mentee.
When you do so many missteps as Intel in semiconductors industry, that's really hard to get back to leadership.
That being said, if tomorrow you wake up with an invasion of Taiwan (which is surely on the options table from CCP perspective), which company will be considered as most important strategic company in semiconductors stack?.. Would INTC be part of discussion? That fact itself should put us to think hard about the strategically important companies in the semiconductors industry
Interesting comment.
Very well said! Intel has a rich history but did they did get to comfortable at the top. Gelsinger has brought them back to what made them great in the first place and that is solid engineering.
Great videos, you guys are good at what you do. Do you share your current portfolio?
Could be, the play I see with it is selling long-term puts. There's good premium in them. Let them camp on margin, you don't have to use the capital in your account to hold the shares. It's a good company to bet on not getting worse is basically the thought process
Will intel going to make ARM chips in these new fabs for clients?
so ARM is the new NVDA?
Yes
They have a partnership with ARM to make their chips for other companies.
Will you guys ever do a video on FTGFF (Firan Technology Group)? They do PCB's for aerospace and defense or is it too small of a company for you guys to cover?
That's not one we're familiar with, will take a look, thanks!
Hopefully people sell so I can buy. I am there for the long term. I want the price to be really down.
Intel is indeed in a difficult spot.. but is it not to big to fail for the us from a geopolitical point of view?
Yeah, I bought on the hype, then sold INTC within a month. Summed up very nicely by Nick- "opportunity cost"
After working at Intel for 4 years, I've concluded that they fucking suck. The culture is so old-school it really holds them back. Sold all my stock after losing all hope of them getting any better.
Really sorry to hear that. We hope they can turn things around. And hope you learned some good stuff (or what not to do) while you were there. Thanks for sharing!
When did you leave?
Which part of its culture you think old school and holds them back?
Indian chain, less education people hands on, no PE more than 5-year experience. That’s bad culture.
Sometimes old school still good the new (kids) just fresh from school and Job experience and never want to learn from basic and cut the corners. They always think real life are same as the same thing they learned in schools and on computer
Sold it around 43 44 so glad you guys chose this one.
Intel is one I’m DCA for the foreseeable future.
I agree it doesn't look to good, it is a tough business, but opportunities are sometimes arround the corner. It seems they are working hard and puttingin the effort.
Semiconductor industry changes rapidly, todays winner can be tomorrows loser as history showed.
I think it all depends on their manufacturing turnaround progress. So far I’m not impressed but if they do manage to catch up to TSMC I think they’re undervalued. If they don’t catch up to TSMC then I think they’re overvalued.
8:20 Intel actually said they expect break even at the mid-point between now and their 2030 target. That would put it somewhere in 2027, but yeah...
Intel made big bet on fab but will it work? Taiwan semi is now in US
Qualcom 's ARM is gonna eat Intel's x86 in the year to come.
If all games develop for ARM processors that is
Percentage of laptop gamers are small
Server processors can use ARM. There's a huge market for it. The client processor market is very small compared to that. So yes, ARM will sell more. But on the client market, i think it's very hard to replace, x86 processors. I use a apple m series processor. I can't play AAA games on my Mac Even if I do virtualization stuff like using parallels. Maximum of the games were originally made for x86. And there are other things like you cannot use anti cheat softwares on ARM virtualization. So I am not able to play AAA games on my Mac. I initially bought a high end Mac partly because I wanted my PC to be an all rounder. I am one of those people who will pay for good tech. For me ARM is just for low end or mid tier laptops who don't play games. ARM is Not for those people who will pay a very good price to get an all rounder high end gaming PC
The only solution for ARM is, all game developer companies should port their games or develop games for ARM processors
Only high end PCs will avoid ARM and will definitely use x86. Rest low end and mid tier PC can use ARM
I recently sold Intel at 42. I bought it in the twentieth. I liked the idea of building new production plants as the are not quickly constructed. Once online I am thinking they will have the best equipped fabs as you call them. Chips are going to be used more and more not just in high dollar items but in toasters. I also like the government chip act which shows the importance of our needs to be self reliant. I’m on the sidelines right now but will jump back in if prices fall back into the 20s. Unfortunately I’m don’t know tech but I understand supply and demand. What do you smart tech guys say?
Intel his much more important than all of those other companies though. The fab angle is a cash burn today but makes it the most important semi to the west and will allow them to get hundreds of billions of free money from governments. Way more important than Nvidia, AMD, etc which is why you need to be bullish
I would like to see an argument regarding this claim from someone who had knowledge in this industry.
I JUST WANT TO SAY THANK YOU FOR THE GREAT EDUCATION ON THIS. I WAS GOING LONG ON THIS STOCK , BUT REALIZE THAT IS A VERY LONG LONG. JUST SOLD , THX
Great analysis!
Is ARM a play? earnings are on the 8th.
Intel is too far behind. Thanks for having the courage to cover this so honestly.
Just buy INTC, cause we can see crypto market and compare. I think price can comeback to 50$
Maybe INTC needs to give PLTR a call. Maybe Alex can help Pat get things rolling fast or at least faster.
Of course they are a buy. Rebounding soon taking flight. Have an edge in having secured ASML miracle making equipment. Even Nvidia will have to buy from them. And huge swathes of chip land will anyway turn to them for tier 2 stuff with enough quality and practical pricing. In 3 yrs Intel will have risen like Phoenix from the ash. Be smart!😊
Many others told us this 3 years ago...
They told his sister years ago and they were right. Look at where Intel is compared three years ago. They didn't even have a separate foundry business. There server and PC processor sucked. Now they are world-class and beating AMD.
They are on the forefront of client computing AI in French chips, and are catching up to Nvidia on server side AI compute.
They have $15 billion already secured on their 18 A process note, which is debuting second half of 2024 . They signed up Microsoft as a large client.
Supply and demand, there is not enough supply at TSMC to make AI chips, where are these companies going to go, once they see success with Intel and a few other large companies that are choosing Intel 18 a process node?
People doubted last year, and Intel soared 80%.
This dip won't last long and will rebound and then shoot into the 50s and the 60s
As usual great video
Thanks you!💯
Just opinions. There are millions.
There is no point buying Intel when you can buy TSM, in my opinion
And if China invades Taiwan, what happens to TSMC stock price? And Intel ?
Intel is poised to soar to new heights, surpassing the 300 mark by 2030. With the exponential growth of AI driving demand for chips and a scarcity of seasoned manufacturers capable of meeting supply needs, Intel is primed for unparalleled success. While it may not claim the top spot, it's set to dominate sales with an impressive market share.
Thanks!
Intel need another spoke person like nvidia guy
it's so easy to critize intel at the moment. and it's valid. HOWEVER, this is exactly the moment to buy this company! ;)
Warren buffet said never underestimate the power of a popular american franchise
Yeah. Even insiders are buying, specifically Gelsinger. Buying a lot.
1066 shares for me :)
Despite all the mess, Intel still holds 60% of all Cpu market combined. Plus, it is one of the AI chip producers besides Nvidia and AMD. Not everyone earth will be having Nvidia AI chip. Intel will also have demand. I see you too pessimistic imho
When we published this video, the stock was over $50 a share...
Great down to earth analysis that pierces the lies from the Intel CEO. Thank you.
I believe in pat. Plus if all this doesnt work they ca break the company in two with this reorg
The price for intel gets low enough - I can throw some money that way. I got in below 26 and I thought high 30s was kind of sketchy so I started selling. I am willing to jump back in below 30, which I did today. I am interested in putting more capital below 25. I already own QCOM. Everything else was too expensive to hold on to. NVDA and AMD went to the moon. QCOM is still pretty okay. I trim a little.
I mean Intel ain't going no where, it might flounder around for awhile, but there is a price to buy it at - probably mid 20s
This is true, at some point, it's just too cheap. Maybe that's now. We recorded this video prior to the Q1 update.
What about the new China tariffs that they are considering? I would think it would be a positive for Intel to gain new customers for their foundry.
Immediate target $48
Short term investors are gamblers
I just brought 1 share is that a bust or ride it out
The lazy 14nm management team has been completely revamped. Additionally, progress on the 5N4Y roadmap is steady, and they won't have much trouble securing a decent portion of the GPU market share, especially in the current state of excess demand. I think Intel will achieve a much greater turnaround than what IBM demonstrated.
Hey thanks for the video good info . But I believe in Intel comeback . Plus have to say I listen to you guys in 2× the speed n still perfectly understand . You guys speaks too slow haha 😅 .
That's fair, but many have argued this point with us for over 3 years now. All the best. Sorry but we aren't changing our cadence of speech. There's a reason why...
It's getting into an interesting level, but I still expect a massive depression/recession in the next year, so it should trade below book value at that point.
This will be a 3-5 year journey for Intel. Have some patience .
Double bottomed.
Will see a strong reversal similar to 26 Oct 2023.
I am losing faith on Gelsinger: over 3 years and not much progress. Aside from the financial performance, which is not good, they simply do not have the products to compete. Their Xeon chips cannot keep up with AMD's Threadripper, that is where the money is. Not doing that good on the fab side: this new Gaudi 3 is built by TSMC! On the desktop: same chip for 3 years. Their GPU, not that great. I read online that the company's culture is not what it should be, too bureaucratic, intrusive HR dept, key people have left. Who is to blame, the board? It took them 5 years to figure out B.K. wasn't the right CEO. Is Pat the guy to turn this thing around? Doesn't seem like it so far...
I completely disagree. Pat Gelsinger is doing an incredible job. He's honest, unlike the previous CEO, and he has told us time and time again that it will be until 2027 to 2030 when decent profits return.
Intel is transforming it's entire business model. We are building new fabs and reaping extreme tax benefits to do so. We are burning cash to make up for the last CEO dropping the ball on innovation in order to boost the stock price.
Pat is actually making a huge difference! Leave him alone. There is nobody better as CEO during this turnaround.
Somehow, I have more faith in Intel than Tesla😂
I think people forget that Intel has a stranglehold on the consumer market. AMD might make a good product, out performing Intel even for a lower price (not sure if that’s still the case, probably is), but those high performance chips are power hogs and really are only useful for more niche applications such as gaming.
Further Intel getting into the foundry business means that when something happens between Taiwan and China, Intel will probably become the chief manufacturer of chips in the USA.
I think people are blinded by the advances made by NVIDEA and AMD, and don’t realize how precarious it is that all their manufacturing is basically done in two places that could very well be at war in the coming decades.
If unsure ask Pelosi. She got good nose for nvidia.
😁
your wrong, intel will be $100+ within 2 years. Intel comeback is real, just getting started
❤
I made $100 yesterday
not impossible, but IMO the next bubble will be quantum compute. So IBM is probably where you want to build.
*you’re
Nop...don't believe that at all!
Intel stock dropped 30% the last month...30$ now
what happens if taiwan is invaded? instant financial payoff ~ $intc doubles that same week
Intel powering genocide at gigahertz speed.
18A
Perhaps Intel should hire a Taiwanese-American as its new CEO...
+1
just buy smh and forget about intc
Exactly. Or SOXX
intel has a shameful history, in what it did against AMD.
Intel Corp (INTC), once an iconic EMPIRE has been decimated. Extremely SAD and disappointing. FAILURE!
This Co is an absolute WASTE OF TIME
Bullish AF
I buy Intel as a hedge for my Apple, Nvidia, AMD and Qualcomm investments. If China invades Taiwan Intel stock is going to skyrocket protecting against losses from the other companies.
Are you guys bots? AI? I know you can’t be human, humans don’t talk like that.
Wone of the worst company in usa after greedy boeing and tesla
seems like Semis are an all or nothing. If you fall asleep at the wheel you get run over.