TLDR
- Nvidia invested $5 billion in Intel, sending INTC stock up 20% in a single day
- Benchmark analyst upgraded Intel from Hold to Buy with $43 price target, citing “watershed agreement”
- Erste Group analyst also upgraded Intel from sell to hold on production improvements
- Partnership positions Intel to become Nvidia’s foundry client using 14A process technology
- Intel stock gained 2% Tuesday on lingering positive sentiment from the deal
Intel stock continues climbing after Nvidia’s surprise $5 billion investment announcement. The partnership has transformed Wall Street’s view of the struggling chipmaker almost overnight.
The market response was immediate and powerful. Intel shares rocketed 20% higher in a single trading session following the Nvidia deal news. Investors quickly recalibrated their outlook on a company many had written off.
This investment joins Intel’s growing funding pipeline. The company already secured $10 billion from the U.S. government and $2 billion from Softbank. Combined, these investments give Intel the resources needed for its turnaround strategy.
Benchmark’s five-star analyst Cody Acree sees this as Intel’s inflection point. He upgraded the stock from Hold to Buy, setting a $43 price target that implies 46% upside potential.
“We believe the announcement with Nvidia marks a watershed agreement in Intel’s long-term competitive positioning,” Acree explained. The analyst ranks among Wall Street’s top 2% of performers.
Strategic Partnership Benefits
The collaboration extends beyond simple financial backing. Both companies will work together on AI infrastructure and PC development, creating new revenue opportunities.
Acree believes Nvidia could become Intel’s first major foundry customer using its next-generation 14A process technology. This would validate Intel’s manufacturing capabilities and attract other high-profile clients.
The partnership also aligns Intel with presidential goals for domestic semiconductor manufacturing. Political and financial momentum appears to be shifting in Intel’s favor.
European Analysts Join Upgrade Wave
European banks are also warming to Intel’s prospects. Hans Engel from Austria’s Erste Group upgraded Intel from sell to hold Monday.
The analyst cited progress in Intel’s transformation program and improved production speeds. He noted that both Nvidia and Broadcom are currently testing Intel’s production platform.
If Intel continues attracting new manufacturing clients, Engel believes the company could return to profitability. This represents a major shift for Intel’s money-losing foundry business.
Tuesday’s trading session showed continued investor confidence. Intel gained 2% despite limited fresh news, outperforming the broader S&P 500 index which fell 0.6%.
Wall Street consensus remains cautious with a Hold rating. However, recent analyst upgrades suggest growing optimism among market professionals. The Nvidia partnership provides both funding and credibility Intel needs to compete with industry leaders like TSMC.
