There is a difference, most grilling aficionados know, between the steak and the sizzle. Chip stock Intel (INTC) has had plenty of sizzle in the last few days, thanks to the installation of new CEO Lip-Bu Tan. But the rally is getting substantial, and some are starting to wonder if Intel’s plans can support this surge in stock value. Investors are still giving Intel the benefit of the doubt, and Intel shares are up around 1.5% in Tuesday afternoon’s trading.
In just the last few days, reports note, Intel stock is up about 24% from what it was just prior to last Wednesday. That’s an extra $22 billion of capital poured into Intel. But the market is likely starting to wonder what Intel will actually, you know, do to make that surge in investment worthwhile. We have heard some things out of new CEO Lip-Bu Tan, and these things are solid. A focus on the foundry, which has already pulled a ton of cash out of Intel. A focus on AI chips, which Intel already dropped the ball on and now needs to play catchup with.
Good, but as some point out, there is still a lot missing. Right now, Intel’s plans look a lot like the “Underpants Gnome” business plan of South Park fame. We know phase one is “collect underpants.” And we know phase three is “profit.” But phase two is where everyone seems confused. For Intel, it is not much different; the foundry is going to be a focus, but we do not know if any of the buyout plans are going forward, what parts of Intel will get sold off, if any, and many other “phase two” parts that seem to just be big question marks.
More Concrete Plans
But thankfully, more concrete plans have emerged. Developers will be happy to hear that Intel has now released the XeSS 2.0 software development kit (SDK), complete with plugins ready to go for both Unity (U) and Unreal Engine. With XeSS 2.0.1, developers will get access to a much smoother and easier to use toolkit for bringing XeSS-SR, XeSS-FG, and XeLL technologies to games.
With those three technologies—named largely for their benefits—developers now get access to “super resolution,” “frame generation,” and “low latency” technologies. This in turn should help improve the final products, and make games developed with Intel’s XeSS toolsets better and more attractive in the market.
Is Intel a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 27 Holds and four Sells assigned in the past three months, as indicated by the graphic below. After a 37.34% loss in its share price over the past year, the average INTC price target of $23 per share implies 11.98% downside risk.
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