Intel Stock Soars 10% on M&A Buzz: Is a Takeover Imminent?

INTC Stock Analysis

Shares of Intel Corp (INTC) jumped almost 10% on Friday as speculation circled through the headlines that the company may be an M&A target.

The one-time Semiconductor giant's stock has been trading at levels that previously hadn’t been seen since 2015 as Intel has struggled to keep up with the AI chip movement.  Shares of Intel are trading almost 70% below their 2021 highs, despite the company’s focus on returning chip manufacturing to the United States.

The CHIPS and Science Act was signed into law by President Joe Biden on August 9, 2022. The act aimed to boost domestic semiconductor manufacturing, strengthen supply chains, and support research and development in the U.S. semiconductor industry.

Intel was at the center of the act with the company’s plans to increase domestic chip manufacturing as a matter of national security.

While the company did get a boost, constant political volleying and a lack of fundamental strength from Intel’s management have clouded the company’s plans.

Rumors that Intel could be an acquisition interest started to circle in late 2024 as the company’s stock neared its book value.  As of January 16, that book value was $19.67 per share, as shares were trading just below $20.

$20 has been the technical bottom for Intel shares since August as investors continue to suspect that the company could sell all, or part, of the company’s manufacturing.

At this point, investors will look for news that an acquisition is imminent before the month-end when Intel reports its current quarterly results.

From a long-term perspective, Intel remains in a strong bear market trend, which is likely to continue barring merger or acquisition with an outside company.

INTC Stock Analysis

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