INTC Stock Alert: JPMorgan Resumes Coverage of Intel With ‘Underweight’ Rating

  • Intel (INTC) stock dropped this morning after an analyst expressed concerns about the chipmaker’s declining market share.
  • Moreover, the analyst warned it will be “several years” before Intel can reclaim its leadership position.
  • Still, INTC stock recovered somewhat and nearly traded at breakeven for the day.
INTC stock - INTC Stock Alert: JPMorgan Resumes Coverage of Intel With ‘Underweight’ Rating

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Sometimes, tough talk from a big-bank analyst can prompt a selloff in a stock. This was the case early today as JPMorgan analysts released a less-than-stellar rating on Intel (NASDAQ:INTC). Furthermore, traders were anxious as a JPMorgan analyst suggested INTC stock won’t regain its leadership position among semiconductor producers anytime soon.

You might call it a “double downgrade,” which means a simultaneous downgrade in a stock’s rating and price target. In this instance, JPMorgan analysts downgraded Intel shares from “overweight” to “underweight.” They also slashed their price target on the shares from $64 to $32.

That’s about as severe as a double downgrade can get. Additionally, one analyst from JPMorgan had some cautious commentary about Intel. In particular, analyst Harlan Sur stated, “We believe it will be several years before Intel is able to reverse the tide to reclaim technology leadership in hopes of regaining market share.”

What’s Happening with INTC Stock?

INTC stock gapped down a couple of percentage points when the opening bell rang on Wall Street. Quite possibly, the only thing that saved Intel’s shareholders from having a terrible morning was the general risk-on feeling in the market.

Intel shares nearly achieved breakeven for the day by 10:30 a.m. Eastern, so the JPMorgan analysts’ influence was limited. Besides, Sur acknowledged that Intel still has 77% of the market share for central processing units, or CPUs.

Nevertheless, Sur is concerned it would require “flawless execution” for Intel to bridge the gap as a tech-market competitor. Sur also claims that Intel will be “pressured by weakening demand for personal technology over the next 12 to 18 months,” CNBC reported.

So, the trading community will have to wait and see whether Intel can regain some of its lost market share. Today, however, INTC stock investors are taking the criticism in stride as the market’s rising tide is lifting Intel’s boat.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.


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