INTC: Foundry And AI Execution Will Drive Confidence In Turnaround Narrative

Analysts have lifted their Intel fair value estimate to about $52 from roughly $27, reflecting improving execution, early but encouraging foundry progress, and a clearer AI strategy, even as they continue to flag rich valuation and execution risk.

Analyst Commentary

Recent Street research reflects a more constructive, but still guarded, view on Intel as bullish analysts acknowledge improving execution and a clearer AI and foundry strategy. Multiple firms have lifted price targets and moved ratings higher, even as they caution that the current share price already embeds substantial optimism about the turnaround.

Several Hold and Neutral ratings now sit at meaningfully higher price targets, with fresh coverage suggesting Intel is fairly valued rather than deeply discounted. At the same time, pockets of skepticism remain, including outright downgrades that argue the stock rally has outpaced tangible progress on manufacturing competitiveness and profitability.

Foundry optimism is a key theme in the upgraded views, with higher estimates tied to the potential for Intel to secure incremental customer wins and execute on its manufacturing roadmap. However, even bullish analysts emphasize that success will depend on consistent delivery against ambitious cost, yield, and technology milestones over the next several years.

Valuation remains a central debate. Bulls argue that improving fundamentals, AI exposure, and potential U.S. manufacturing tailwinds can justify richer multiples, while more cautious voices highlight that Intel now trades above historic earnings ranges despite lingering margin pressure and long dated foundry returns.

Overall, the Street is shifting from deeply skeptical to cautiously optimistic, with more balanced commentary that recognizes both the upside from a successful turnaround and the risks if execution or end market demand disappoint.

Bullish Takeaways

• Bullish analysts have raised fair value and price targets materially, citing better demand trends, cleaner quarterly execution, and improving visibility into AI and foundry growth, which together support a higher earnings and cash flow trajectory.
• Upgrades from previously bearish stances to more neutral positions reflect a reassessment of downside risk, as recent results and strategic actions suggest the turnaround is gaining traction rather than deteriorating, helping narrow the valuation discount to peers.
• Optimistic models are incorporating incremental upside from foundry services and packaging, including early interest from large chip designers, which, if scaled successfully, could transform Intel into a more diversified, higher growth manufacturing and design platform.
• Some bullish forecasts assume Intel will benefit disproportionately from policy support and a shift toward U.S. concentrated manufacturing, which could underpin sustained capital investment, higher utilization, and stronger long term earnings power than current consensus implies.

What's in the News

• Intel is reportedly in advanced talks to acquire AI chip startup SambaNova, deepening its move into full stack enterprise AI systems and appliances. Any deal would still require feasibility work and regulatory approval (Key Developments).
• Intel previewed its Panther Lake Intel Core Ultra series 3 processors and Clearwater Forest Xeon 6+ server chips, the first major platforms on its 18A process. This signals progress on its next generation PC and data center roadmaps (Key Developments).
• Intel guided to fourth quarter 2025 revenue of $12.8 billion to $13.8 billion with a diluted loss per share of $0.14. This underscores that its turnaround and foundry investments are still pressuring near term profitability (Key Developments).
• Intel CEO Lip Bu-Tan and the company firmly rejected allegations that a recent senior hire from TSMC may have brought over trade secrets. They reiterated Intel's policies against using third party intellectual property, even as TSMC pursues legal action against the former executive (Bloomberg, Reuters).
• Intel continues to highlight ecosystem momentum around AI, including collaborations with partners such as TurinTech and SED Initta Technology to bring optimized, on device and retail focused AI solutions to Intel based platforms (Key Developments).

Valuation Changes

• Fair Value Estimate has risen significantly, moving from about $27.24 to $52.00 per share. This implies a sharply higher intrinsic value assessment for Intel.
• Discount Rate has increased slightly, from roughly 11.44% to 11.65%. This reflects a modest uptick in perceived risk or required return.
• Revenue Growth has edged higher, with the long term annual growth assumption increasing from about 5.40% to 5.72%.
• Net Profit Margin has improved meaningfully, with the forecast margin raised from roughly 14.0% to 18.0%. This indicates expectations for stronger long run profitability.
• Future P/E Multiple has expanded substantially, climbing from about 20.1x to 37.2x. This signals a higher valuation multiple applied to Intel's expected earnings.