Key points:
- Morgan Stanley argue INTC stock is likely to move sideways for the coming years
- The market offers higher growth opportunities from rising tech
- INTC stock trades on a daily loss of 2.2%, down 20% year on year
Intel (NASDAQ: INTC) has been one of the most prominent and respected names in technological innovation since the dawn of the millennium. Since then; Intel has been a key figure in everything computing and data – exemplifying the non-existent boundaries of modern tech. Now though, a competitive market is pivoting towards the rising stars rather than the elders of innovation, leaving companies like Intel on a cliff-edge.
Since March 2021, Intel stock has been the victim of a heavy downtrend. The market hasn’t been kind to long-standing giants, with the pandemic weighing on firmly planted companies in favor of high-growth pandemic favorites. We can’t fully put the blame on pandemic trends, internal direction has also been slightly skewed, with words like ‘turnaround’ and ‘stagnancy’ coming to mind. Luckily for the company, new CEO Pat Gelsinger looks to be a promising addition; but short-term gains still appear somewhat limited.
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Morgan Stanley analyst Joseph Moore outlined similar beliefs this morning, downgrading the tech company from Equal-Weight to Underweight whilst cutting the price target from $55 to $47. Whilst Moore believes in the long-term opportunity for a turnaround given the new CEO, he believes that there are more lucrative opportunities elsewhere in the markets; outlining that Intel stock is likely to move sideways for ‘the next couple of years’.
Intel has gone all out recently in its investment in capacity and the company’s Foundry arm, with Moore pointing out that the company is likely to have very limited free cash flow over the coming years. INTC stock is currently trading at a daily loss of 2.2% and is down 20.3% year on year. Investors should be aware that although Intel might still be a promising long-term bet, gains might be limited over the coming years and there are numerous other companies that offer a more attractive risk/reward with more reasonable entry pricing.
