INTC Stock Pops: This Analyst Says an Intel Short Squeeze Is Underway

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  • Mizuho believes that the recent rise in Intel (INTC) and other semi stocks is due to a short squeeze.
  • However the firm also notes that Intel has a “lack of exciting growth.”
  • INTC stock is down by over 25% this year.
INTC stock - INTC Stock Pops: This Analyst Says an Intel Short Squeeze Is Underway

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Shares of Intel (NASDAQ:INTC) are up by 10% during the past five trading days. That’s due to shorts covering, according to analysts at Mizuho.

“ARM ripped 8% Fri, AMD up 5% and near 8% past week, and even ON up 8% in past week (likely on TSLA rally). If hedge funds long AI semis want to lower exposure and rotate into non-Semi longs, they will sell some NVDA, AVGO, MU and cover shorts,” said the firm. Mizuho added that these shorts include Intel and Advanced Micro Devices (NASDAQ:AMD).

Analysts added that some investors believe that the upcoming Semicon West conference between July 9 and July 11 could help boost INTC as well.

INTC stock is down by over 25% this year. Shares of the technology company dropped by 15% after it posted its earnings on April 25, although most of those losses have since been made up. During the beginning of the year, Intel guided for Q1 revenue of between $12.2 billion and $13.2 billion. Actual revenue was $12.7 billion.

INTC Stock: Mizuho Attributes Gains to Short Covering

Despite the squeeze, Mizuho still doesn’t have much faith in Intel.

“Unless you were betting for a big guide down for Q3 or push out of the leading edge node based new products for PC, data center, then what is the incremental [negative] catalyst for downside? No [long only] investors like or want to buy INTC, so a true rebound beyond mid $30s is unlikely in my view in coming months,” said Mizuho. The firm also added that the company has a “lack of exciting growth.”

Intel has guided for second-quarter revenue of between $12.5 billion and $13.5 billion. It made $12.9 billion during the second quarter of 2023. The midpoint of the guidance would signal growth of less than 1%.

Across the board, INTC carries an average price target of $35.48, which is near where shares are currently trading. The highest price target sits at $62.81, while the lowest is $15.70. The wide price target range suggests that INTC could witness volatile price action in the coming months.

On the date of publication, Eddie Pan did not hold (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

On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.

Eddie Pan specializes in institutional investments and insider activity. He writes for InvestorPlace’s Today’s Market team, which centers on the latest news involving popular stocks.


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