To The Moon

$Intel(INTC)$  Below is a reasoned analysis of Intel at ~$30 in light of the newly announced NVIDIA partnership, plus assessment of a $40 target and potential upside given its market cap. As usual, this isn’t investment advice — think of it as a framework for your own decision-making.

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Key Facts First

From recent reporting:

NVIDIA is investing $5 billion in Intel at $23.28 per share, gaining roughly a 4% stake in Intel. 

The partnership envisions Intel building custom x86 CPUs for NVIDIA’s data center / AI infrastructure, and also jointly developing “x86 RTX SOCs” for PCs with NVIDIA RTX GPU chiplets built in. Integration via NVIDIA’s NVLink is part of the plan. 

Intel is still unprofitable on a trailing 12-month (TTM) earnings basis; its P/E (TTM) is negative. 

Price/Sales metrics suggest Intel is relatively cheap versus many semiconductor peers. For example, its PS is ~2.7× versus peer averages materially higher in many cases. 

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1. Is Intel still a buy at ~$30?

Pros:

The NVIDIA investment gives Intel both cash infusion and validation, and potentially stable future revenue streams from joint products. That helps its balance sheet, credibility, and gives investor confidence. 

Intel gains a strategic partner in NVIDIA, which is among the leaders in AI acceleration. The collaboration may help Intel accelerate its product roadmap, especially in AI-centric data center CPUs and SOCs, and make it more competitive vs AMD, TSMC’s foundry customers, etc. 

At ~$30, part of the upside might already be priced in (given the big jump from $23.28, etc.), but there is room for further upside if the partnership yields product wins, margin improvements, better manufacturing progress.

Risks / Cons:

Intel remains unprofitable (as of trailing earnings), so its path to sustainable profitability is not yet assured. Negative earnings are a big risk factor. 

Manufacturing execution remains a weak point. Intel’s foundry business has lagged competitors, both in process technology and scale. Even with NVIDIA collaboration, Intel will need to make significant progress to catch up. 

Integration risk: co-developed products, new SOCs, GPU chiplets etc., involve complex engineering, cost, and yield challenges. If delays or cost overruns happen, the valuation could suffer.

Competitive risk: AMD, TSMC, and others are moving fast in AI, GPUs, HPC; Intel needs to deliver not just designs but volume, performance, and cost competitiveness.

Conclusion on “Buy at ~$30”:

Given the partnership, there is a credible case that Intel is a speculative to moderate buy at ~$30, more so if you believe in the long-term strength of AI demand, the reliability of Intel’s execution, and NVIDIA’s role as a strategic ally. But this is not a low-risk play: it depends heavily on future performance, which is not yet proven. If investing, a portion of position or using a longer time horizon makes sense.

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2. How the NVIDIA investment might affect Intel in the long term

Here are likely long-term impacts:

Revenue streams & product pipeline: Intel will have new contracts / orders from NVIDIA, for custom CPUs and SOCs integrating GPU chiplets. If those products perform well commercially, they could generate meaningful revenue over multiple years.

Manufacturing leverage & scaling: The partnership gives Intel stronger justification to invest (or accelerate investment) in its next-generation process nodes, fabs, and packaging technologies. The commitment of a high-profile partner helps reduce uncertainty.

Margin improvement potential: Having higher-margin designs (AI, data center) could improve margins vs just commodity PC CPUs. Also, leveraging NVIDIA’s graphics IP may improve value per chip / per unit. But this depends on yield, defect costs, capital investment etc.

Competitive positioning: Intel gains strategic differentiation vs AMD and others, particularly if the combined Intel CPU + NVIDIA GPU SOCs or custom x86 CPUs for AI infrastructure are compelling in performance + power + integration. Also, being tied to NVLink may allow features and optimisations unavailable to others.

Risk of dilution / governance: The fact that NVIDIA invested at a lower price ($23.28) means that at current ~$30, there’s a gap; NVIDIA has a stake and influence. If Intel has to issue more shares, or if CAD / capital intensity increases, that may exert pressure. The terms of partnership, who bears what costs are important.

Technology roadmap acceleration: Joint R&D, joint product definitions may force Intel to accelerate roadmap, which can be good (faster innovation) but risky (cost, feasibility, process maturation).

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3. Is $40 a reasonable next target price?

To evaluate a $40 target price, need to consider how much upside that implies, what assumptions are necessary, and how realistic they are.

From ~$30 to $40 is ~33% upside. That’s not absurd for a high potential Technology / Semiconductor name, especially given the recent surge and positive sentiment.

But to justify $40, you’d likely need several of the following to occur:

1. Intel transitions to profitable or significantly improving operating income + narrowing losses, possibly turning net income positive or close to so.

2. The joint products with NVIDIA are successful, bring meaningful revenues, possibly earlier than expected.

3. Manufacturing execution is strong: good yield, process node improvements, cost controls.

4. Market multiples expand (i.e. investors begin to price Intel more like growth semiconductor peers).

5. Macro tailwinds: favourable demand, low supply chain disruptions, decent demand for AI / data center infrastructure.

If those happen, $40 is achievable over a medium term (say 12-24 months). But if some break assumptions (delays, costs, competition), then $40 could be too optimistic or take longer.

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4. With ~$116-$120-ish B market cap, how much upside is left?

First, Intel’s market cap currently (post jump) is in the ballpark of $110-ish to $140B depending on source / after the rise. 

Upside depends on valuation multiples: given Intel is unprofitable, usual P/E based upside is less useful; better to look at revenue, margin trends, PS (Price/Sales), EV/EBITDA, forward earnings expectations.

From PS metrics: per SimplyWallSt, Intel’s PS is ~2.7×, much lower than many peers. If Intel could reach even a more moderate multiple (say PS ~5-8×) while growing revenue and improving margins, that would imply substantial market cap upside. However, that multiple expansion assumes credibility and performance improvements.

If you assume $40 share price, that implies a certain market cap depending on share count. If share count remains stable, the market cap should increase proportionally (~33% above current). That suggests the market collectively believes Intel can deliver on many of the positive assumptions.

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Overall Judgment: Upside Potential vs Risks

Upside potential is material, especially given the recent NVIDIA deal and AI tailwinds. There is scenario in which Intel is re-rated, delivers better financials, and pushes share price toward or beyond $40.

But risk is also high: execution (manufacturing, chip development, yield), time lags, competition, costs, and macro headwinds (e.g. chip demand cycles, supply chain, geopolitical risk) could delay or reduce upside.

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If I were to give a probability sense (just my estimate) for Intel hitting $40 within next 12–18 months:

In a favourable scenario (partnership works well, execution is strong, margins improve) → maybe a 40-50% chance

In a base case (modest improvements, some wins but some delays) → more like 20-30%

In a downside scenario → could stay below current, or see pullbacks if risks fail to be addressed.