Intel stock has fallen out of favour with investors due to various problems. Due to development problems and the loss of Apple as a customer, Intel has been punished. Competitor AMD has snatched the performance crown with its chips and therefore enjoys a higher reputation. At the moment, the stock seems as sexy as house dust. However, there are some aspects that are often overlooked when evaluating the potential.
New graphics cards
PC gamers know that because of the crypto boom, many miners are buying graphics cards straight from the factory to profitably mine altcoins. The market as well as the second-hand market for graphics cards has dried up and prices have risen absurdly. There are new leaks that Intel could bring its first real graphics card series "DG2 Xe HPG" this year and thus end the duopoly of AMD and Nvidia. These are currently barely keeping up with production. Intel had poached AMD's chief engineer for graphics cards, Raja Koduri, in 2017. If the crypto boom continues, all three would certainly earn well.
Intel Habana: Accelerator for artificial intelligence
Intel had acquired Israeli AI startup "Habana Labs" in December 2019 for $2 billion. Amazon has announced Intel Habana Gaudi accelerators to be used in its data centers from 2021. There, they will support neural networks, deep learning, speech processing, object recognition as well as classification, and recommendations for products in online stores.
Mobileye: autonomous driving
Intel had made considerable progress in autonomous driving / robotaxis through acquisitions of the companies Mobileyeand Moovit. It is seen as having an advantage over Tesla because Intel uses a second system with LIDAR in addition to cameras. Intel's partners include VW, BMW, Ford, Nio, Nissan and Geely. Market readiness is expected in 2022.
Intel's 12th-generation "Alder Lake" processor is expected to be released in late 2021. Alder Lake is expected to achieve new levels of efficiency in a hybrid design on the desktop, in notebooks and tablets. If the product launch is successful, there may also be potential for the share price.
2020 was a record year for Intel due to Work from Home and Remote Learning, with nearly $78 billion in revenue and a 9% increase over 2019. Intel made more revenue in 2020 than TSMC, AMD and Nvidia combined! The company has been a reliable dividend payer for many years (2.38% dividend yield, no cut since 1994), has many times more revenue and profits than AMD, and is cheaply valued with a 2021 P/E of currently 12 (AMD 43). AMD is still a "midget" against Intel. Intel is also still the leader in sales of data centre, notebook and PC products and had a 93.4% share of the server market at the end of 2020.
Recently, Intel got a new CEO. Instead of an accountant, Pat Gelsingernow is an engineer at the helm. With him, three more industry greats have returned to Intel. This increase in personnel could help optimize research and development.
Misunderstanding manufacturing size
Many are unaware that the manufacturing size of processors in nanometers is not a metric unit in this case. AMD's 7nm is about the same density (millions of transistors per square millimeter) as Intel's 10nm. They are more marketing terms. Even some analysts haven't understood this yet and see AMD / TSMC's 7nm as more advanced and superior.
Unlike "fabless" companies like AMD, Nvidia and Qualcomm, Intel has its own production facilities and does not have to join contract manufacturers like TSMC and Samsung Electronics to produce processors. This creates sovereignty and a higher profit margin. Intel has a total of 15 factories in the U.S., Ireland, Israel, China, Costa Rica, Malaysia and Vietnam.
Intel stock is certainly not a hot stock and only suitable for very patient investors. However, as described here, there is a lot of future potential. I myself am invested in Intel, AMD, Nvidia and TSMC.
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