Mizuho analysts raised their price target on Intel (NASDAQ: INTC) to $23 from $20, while maintaining the stock rating at Neutral. The upgrade reflects growing optimism about the beleaguered chipmaker’s foundry business, which could pick up momentum thanks to the Trump administration’s focus on expanding U.S. chipmaking, especially for artificial intelligence.
In a note released Sunday, Mizuho analysts wrote,
“We see INTC’s foundry potentially gaining steam under a renewed push by the Trump administration to bring AI chip production to the US.”
Intel is currently the biggest recipient of government funding through the CHIPS Act. With President Donald Trump pledging to prioritize AI chip manufacturing on American soil, analysts believe the Santa Clara-based company could secure even more support to bolster its foundry ambitions.
The price target hike arrives amid media reports suggesting Taiwan Semiconductor Manufacturing Company (NYSE: TSM) and Broadcom (NASDAQ: AVGO) are exploring separate deals for Intel and its foundry operations, especially as once a dominant force in the chip industry struggles with a failed restructuring and an extended downturn.
However, Mizuho analysts cast doubt on TSMC acquiring Intel’s foundry. They argue that the Trump administration would resist handing U.S. chip factories to a foreign company. Additionally, TSMC focuses on maintaining its edge in producing ultra-small, advanced chips, which reduces the odds of a partnership with the U.S. chipmaker.
On the other hand, Broadcom emerges as a more likely candidate to purchase Intel, Mizuho analysts suggest. They acknowledge that such a deal would lean heavily on debt and equity financing. Still, they see compelling advantages for Broadcom, including strengthening its industry leadership, capitalizing on Intel’s discounted valuation, and unlocking opportunities to streamline operations. These benefits could outweigh the financial risks and give Intel a new lease on life.
Mizuho flagged “multiple challenges” ahead for the company, including the search for a new CEO after Pat Gelsinger’s exit last year. It also grapples with shrinking market share in server and AI PC segments, a weak grip on AI opportunities, and a tricky shift to a foundry model. These pressures could weigh on Intel (NASDAQ: INTC) stock in the year ahead, even as its foundry prospects flicker with hope.
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