Intel (INTC) Backed by HSBC as Server CPU Growth Drives Re-Rating

Intel Corporation (NASDAQ:INTC) is one of the 12 AI Stocks in Focus on Wall Street: Tesla, Meta, and More.

Intel recently witnessed a core business re-rating driven by server CPU growth and pricing power from HSBC. It is seventh on our list of 12 AI Stocks in Focus on Wall Street.

On April 21, analyst Frank Lee upgraded the stock from Hold to “Buy” and raised the price target to $95 from $50. This could eventually drive strong earnings upside potential for the stock, as per the firm.

Upgrade to Buy (from Hold), TP USD95 (from USD50) on core business alone: We move to a PE multiple-based valuation but deploy a SOTP valuation based on a 2027e target PE of 26x for the core business.

The firm particularly mentioned that the foundry business isn’t included in their valuation due to external customer related uncertainty that remains. However, expectations of robust growth in server CPU shipments and anticipated price increases has led to the upgrade.

Intel, the firm believes, has “game-changing server CPU potential” which has not yet been priced into the stock.

Our rounded TP of USD95 (from USD50) implies c45% upside and we upgrade our rating to Buy (from Hold) based on the core business valuation driven mainly from server CPU shipment growth and price hikes leading to significant upside earnings potential.

Intel Corporation (NASDAQ:INTC) designs, manufactures, and sells computer products and technologies, delivering data storage, computer, networking, and communications platforms.

While we acknowledge the risk and potential of INTC as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than INTC and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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