What Happened?
Shares of computer processor maker Intel (NASDAQ: INTC) fell 5.8% in the morning session after a Bank of America analyst downgraded the stock to "underperform" from "neutral," citing concerns that the shares had climbed "too far, too fast."
The analyst noted that the stock's recent rally, which added about $80 billion to its market value, was not justified given its ongoing challenges. These concerns included an uncompetitive server CPU lineup and no clear strategy for the growing artificial intelligence market.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Intel? Access our full analysis report here.
What Is The Market Telling Us
Intel’s shares are extremely volatile and have had 36 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 previous big move we wrote about was 12 days ago when the stock gained 3.8% on the news that reports surfaced that the company was in early talks with its competitor, Advanced Micro Devices (AMD), about a potential deal to manufacture chips for them. The potential deal was viewed as a major vote of confidence in Intel's push to build its foundry business, which makes chips for other companies. A partnership would be significant because AMD, a fierce competitor, has historically relied on Taiwan's TSMC for manufacturing its chips. For Intel, securing its main rival as a customer would validate its manufacturing technology and its ambition to compete with global foundry leaders. For AMD, the arrangement could provide a US-based production alternative and increase its bargaining power with other suppliers.
Intel is up 74.5% since the beginning of the year, and at $35.27 per share, it is trading close to its 52-week high of $37.80 from October 2025. Investors who bought $1,000 worth of Intel’s shares 5 years ago would now be looking at an investment worth $658.71.
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