Investing in Intel (NASDAQ: INTC) has been a rollercoaster ride in recent years. Once the undisputed leader in the CPU market, the company faced tough competition and setbacks, with its stock taking a 7% dip over the last three years.
Fierce competition from Advanced Micro Devices and the loss of Apple as a major client led to a decline in market share and revenue. However, recent data indicates that Intel is staging a comeback, making it an attractive investment option for 2024.
1. Intel’s AI Ambitions
The relentless march of technology is shifting towards artificial intelligence (AI), and Intel is not one to be left behind. With the AI market expected to reach over $1 trillion by 2030, Intel is strategically positioning itself to capitalize on this lucrative sector.
While Nvidia has taken the lead in AI GPU market share, Intel is aiming to challenge its dominance with the launch of the Gaudi3 GPU, as well as new Core Ultra processors and Xeon server chips equipped with neural processing units designed to accelerate AI programs.
Intel’s foray into AI could potentially lead to significant earnings growth in 2024, making it a compelling choice for investors.
2. Recovery in the PC Market
After facing significant headwinds due to macroeconomic factors, the PC market is showing signs of revival. Intel stands to benefit from this recovery, with recent earnings reflecting a positive uptick. Desktop chip sales rose 2% year over year, and the notebook segment posted a substantial 22% increase in revenue.
Intel’s positive performance amidst a recovering PC market signals further potential for growth in 2024, making it an opportune time to consider investing in the company.
3. Projected Earnings Per Share (EPS) Growth
Analyst estimates for Intel’s EPS indicate an upward trajectory in the coming year, supported by a recovering PC market and the company’s advancements in AI technology. Projections suggest that Intel’s earnings could reach nearly $3 per share by fiscal 2024, potentially driving a 42% increase in stock price over the next fiscal year.
With a promising outlook in AI expansion and the improving PC business, Intel presents a compelling investment opportunity for 2024.