Stock Story -
What Happened?
Shares of computer processor maker Intel (NASDAQ:INTC) jumped 8% in the morning session after Bloomberg reported the company could be a potential acquisition target. Bloomberg cited SemiAccurate, a tech site founded by Charlie Demerjian. SemiAccurate claimed it had "read an email about a company attempting to buy all of Intel.".Is now the time to buy Intel? Find out by reading the original article on StockStory, it’s free.
What The Market Is Telling Us
Intel’s shares are very volatile and have had 21 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.The biggest move we wrote about over the last year was 6 months ago when the stock dropped 27.9% on the news that the company reported weak second quarter earnings. Its revenue guidance for next quarter missed analysts' expectations, and its revenue missed Wall Street's estimates during the quarter.
Taking a closer look at the topline results, PC demand was weakened by China export controls and inventory digestion, while Server demand was affected by market share loss. Notably, the inventory-related headwinds are projected to continue till Q3, though at a more modest pace, affecting CCG (client computing group) and DCAI (Data Center & AI) segments.
In addition, the company announced plans to cut 15% of its headcount, which was over 125,000 at the end of the second quarter. Lastly, the company suspended dividend payments which is never a good sign. Overall, this quarter could have been better.
Intel is up 5.4% since the beginning of the year, but at $21.31 per share, it is still trading 57% below its 52-week high of $49.55 from January 2024. Investors who bought $1,000 worth of Intel’s shares 5 years ago would now be looking at an investment worth $357.47.