What Happened?
Shares of computer processor maker Intel (NASDAQ: INTC) jumped 5.4% in the afternoon session after the stock continued to rally following news of a preliminary chip-making deal with Apple, a significant analyst price target increase, and reports of potential acquisition talks.
The stock rose on news of a preliminary agreement to manufacture chips for Apple, a move that highlights progress in Intel's strategy to produce chips for other companies. Adding to the positive sentiment, Melius Research reiterated a buy rating and raised its price target on the stock to $150 from $100. Reports also surfaced that Intel is in discussions to acquire AI chip startup Tenstorrent.
Separately, CEO Lip-Bu Tan confirmed that the company's manufacturing yield—the percentage of functional chips produced from a silicon wafer—is increasing. Intel is also reportedly pushing PC makers toward its newer 18A processors by redirecting older chip capacity to higher-margin server and industrial chips for growing AI demand.
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What Is The Market Telling Us
Intel’s shares are extremely volatile and have had 49 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was about 23 hours ago when the stock gained 4% on the news that Melius Research analyst Benjamin Reitzes reiterated a buy rating and raised the price target to $150 from $100.
The new price target implies a potential upside of over 43% and is the highest among all analysts covering the stock. The bullish sentiment reflects growing optimism about the company's prospects, particularly in the server central processing unit (CPU) market. Other analysts, including those at Citi, pointed to the expanding demand for server chips driven by artificial intelligence. Citi estimated the total market for server CPUs could reach $132 billion by 2030, with Intel expected to capture a significant share.
Intel is up 195% since the beginning of the year, but at $116.35 per share, it is still trading 10.1% below its 52-week high of $129.44 from May 2026. Investors who bought $1,000 worth of Intel’s shares 5 years ago would now be looking at an investment worth $2,080.
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