On September 3, a caller mentioned that they are unsure whether to buy, sell, or hold Intel Corporation (NASDAQ:INTC). In response, Mad Money host Jim Cramer said:
Okay, now, let’s own this right up front. I got too excited about Intel because I knew it was going to have a good quarter. It had an unbelievable quarter, and the stock went down anyway… Here’s the problem: The government has a huge position in it, and they’re supposed to be able to sell it if they want to, and we’re all waiting for the government to sell the stake, and that’s why the stock’s been going down. And I have been saying, listen, I may just have to go in and buy more right here, get a better average, and have it come back. I understand it is mixed, but my belief in Intel is 100%. I just need to see the government get out of the stock or just go buy it anyway.
Operational Turnaround and Earnings Strength
Intel Corporation’s fundamental business is finally turning a corner. The company blew past Wall Street estimates with $16.1 billion in second-quarter revenue, fueled by heavy demand for its Xeon data center chips and solid progress on its 18A manufacturing technology. For patient investors who watched management pour billions into rebuilding the company’s chip-making muscle, these results offer encouraging signs that Intel’s long-term comeback and push into AI hardware are starting to pay off.
The Government Stake and Foundry Drag
Even with those solid numbers, the stock faces a major psychological roadblock: the federal government’s massive equity stake. As Cramer noted, investors are sitting on their hands, worried about when and how that big block of shares might be sold off, creating a potential overhang on the stock. Adding to this narrative are structural headwinds in the foundry segment, which continues to report operating losses as it scales up capital-intensive fabrication infrastructure, leaving the stock vulnerable to sentiment-driven pullbacks.
Hedge Fund Activity and Investor Sentiment
Institutional interest reflects growing engagement along with the company’s operational recovery. According to Insider Monkey’s tracking data, 138 hedge funds held positions in Intel Corporation during the second quarter, marking an increase from 112 funds in the prior quarter. Short interest stands at 2.57% of the public float, showing a measured level of skepticism without aggressive bearish shorting.
Intel Corporation is executing well on the business side, but the constant worry over the government selling its massive stake creates a potential overhang. While Cramer stays fully behind the long-term recovery and sees a chance to buy the dip, short-term traders will probably stay sidelined until that government block of shares is finally out of the picture.
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