Intel Corporation saw its shares rise approximately 3.3% to $111.69 during Tuesday afternoon trading, snapping a five-session losing streak. The bounce came as analysts from Citi and Benchmark raised their price targets on the stock, citing improving demand for central processing units (CPUs). Trading volume exceeded 112 million shares, well above the daily average, as investors repositioned ahead of Nvidia's highly anticipated earnings report.
Analyst Upgrades Fuel Optimism
Citi analyst Atif Malik increased his Intel price target to $130 from $95, maintaining a Buy rating. In a research note dated May 18, Malik wrote, "We are constructive on CPU demand as the industry moves to inference and agentic AI which need more CPUs." Agentic AI refers to software that can act autonomously rather than just responding to prompts, a shift that could drive demand for Intel's processors. Benchmark analyst Cody Acree also raised his target to $140 from $105, keeping a Buy call. Acree noted that after a recent fireside chat with Intel management, the firm feels more confident about the recovery's sustainability and believes the market may still be underpricing Intel's earnings potential for 2027-2028.
CEO Appearance and Market Context
Intel CEO Lip-Bu Tan was scheduled to speak at the J.P. Morgan Global Technology, Media and Communications Conference later Tuesday. Traders were watching for updates on demand, pricing, and details about Intel's contract manufacturing business, which produces chips for external clients. The company's first-quarter results, released earlier this month, showed a 7% revenue increase to $13.6 billion and non-GAAP earnings per share of 29 cents. For the second quarter, Intel guided revenue between $13.8 billion and $14.8 billion. Tan has emphasized that demand for Intel's CPUs and advanced packaging is getting a boost as AI workloads transition from foundational models to inference and agentic AI.
Nvidia's Earnings Loom Large
The broader semiconductor sector showed mixed performance. Nvidia shares edged up near $223 ahead of its Wednesday earnings report, while AMD dipped to around $417. Options markets are pricing in a potential $355 billion swing in Nvidia's market capitalization after its results, according to Reuters, highlighting the AI trade's ability to move stocks across the chip space. Intel's recent slide—down 16% over five sessions—reflected investor uncertainty about whether AI demand is broadening from graphics processing units to CPUs. The Tuesday bounce suggests some buyers see value, but the rally remains fragile.
Macro Headwinds and Risks
Stocks broadly slipped Tuesday, with the Nasdaq falling nearly 1% as Treasury yields climbed. "Stocks are on the defensive because long-end yields are rising," said Peter Cardillo, chief market economist at Spartan Capital Securities, as reported by Reuters. For Intel, the path forward is not without challenges. The company posted a net loss of $3.73 billion last quarter and must continue heavy spending to scale its foundry business. "TSMC is the real bottleneck," said Doug O'Loughlin, chief analyst at Semianalysis. Seaport Research's Jay Goldberg warned, "No company in history has ever fallen off the Moore's law curve and made it back on."
Despite the analyst upgrades, Intel's turnaround story remains unproven. The stock's gains may reflect bets on a recovery that hasn't fully materialized. If Nvidia stumbles, yields keep rising, or Intel fails to convert demand into higher margins or new foundry deals, the recent rally could quickly reverse. For now, investors are watching closely as the AI narrative continues to evolve.
