Laptop, Television set, Labor Day, Discounts and allowances Intel Stock: The Way To Trillion Dollar | The Comeback Story Is On! | INTC Stock
I know there are very few of you that are fans of this company, because you own amd, nvidia, sml or just dislike intel for one reason or another and thats completely understandable, because the company and the stock has been underperforming for years now and thats. Why md nvidia have been outperforming and taking market share of intel thats also, why intel is trading at a very, very low, multiple compared to the industry average, which is at around 20, or something like that, while intel sits at around 11 a p e ratio and If you compare that to amd, for example, amd is at around 37 38, so lets say if the market suddenly decides to give intel. Amds multiple intel will suddenly be worth more than 700 billion dollars. Obviously, thats not going to happen because well amd is growing much faster than intel right now. Thats also, the reason why intels multiples have been extremely low in the last couple of years, because the company the stock hasnt been moving much the company hasnt really been innovating. That much, but that is obviously going to change. Hopefully we can trust management. I can trust management and, in their plans their new announcements for their gpus, their new foundry services. I think this will really help intel in the next coming years is not going to happen overnight, but in the next coming years. Their plan is to be right at the top around 2024 2025, but im here buying intel for the next 10 years, because i do believe that in 2030 they might be closer to one trillion dollars now.
Obviously this is just speculations from my part but, like i said in previous videos, amd nvidia, smltsfc theyre, all going to make more and more chips, each and every year theyre going to sell more each and every year because we need more semiconductors. Now, with intel being an american company intel still being the largest out there, building foundries in the united states, this is going to help them a lot for the future. So that is why im bullish, but im going to explain way more in detail in this video, but before i do so, i just want to thank todays sponsor the motley fool and again these are my views and my views. Only the motley food is a company that provides investing insight and stock recommendations for investors of all skill sets and risk levels. You guys know i love finding new, investing tools and resources to help me find the latest growth stock and innovative company, and right now i have a discount for one of my favorite services, the full offers through the motley fools stock advisor service. You get access to a ton of expert stock picks every month. Youll get two picks that are aimed at growing your wealth and to help you realize your financial goals, stock advisors, average stock picks have returned over 500 percent. If growing, your money is something youd like to do more. This year you can visit www.fool.com, couch investor or click on the link below for access to my special offer and decide if stock advisor is right for you now lets dive into this Music all right.
First, a quick recap of what i said in my previous videos. Obviously all videos will be in the top right corner, talked about amd and nvidia and asml as well im bullish on all of those companies, but i personally just own intel right now. I used to own amd and nvidia, but obviously, if youve been following me for a while, you know i regret selling it too early. That doesnt mean that i dont love those companies, but intel has announced a couple of months back that it intends to invest 20 billion dollars in its arizona facility and 3.8 billion dollars in its new mexico site. Now these investments also mean that intel will build chips for other clients, a business very similar to that of tsmc. That will be called intel. Foundry services now intel also announced that it has already recruited amazon, web services and qualcomm as one of their first big clients. So thats very, very positive. I believe microsoft is also one of those clients, because weve seen sacha nadella in the presentation with intel, ceo, pat gelsinger. So obviously that makes sense. Now, before i jump into the gpu segment, i just want to show you a bit their balance sheet, so you can see here that revenue is much much higher than amd. For example, even nvidia it sits here lets take the non gaap one at 18.5 billion dollars. Yet its not up 20 50 or whatever its just up two percent year over year, like we said intels business has not been doing great, but earnings per share are up 12 year over year, which is actually not that bad at all.
Now going into the key segment, the key businesses we have here – ccg client computing group thats up six percent year over year. Data center group is down nine percent thats, something that you will have to look for in the next quarters. Now, internet of things, you have your mobile eye, which is up 124. I said this in my previous video be on the lookout for this segment, because, as more and more vehicles become much much smarter look out for this segment for intel its a segment that not a lot of people are talking about that the internet of things ones Is up 47 so quite nicely as well? Obviously, both of them here are not really contributing that much as of today, but that will change in the future. And then you have those last two segments here: nsg and psg, not the football team down 34 and down three percent. So lets go back into the gpu announcements, so intel announced their new gpus called arc that should compete with amds and nvidias that will launch in early 2022.. Intel has not disclosed any specific hardware configurations and it also hasnt gone into any detail about clock speed. The memory interface or the amount of type of ram that the first arc gpus will include now, obviously, until these gpus get out there, we cant really compare one to another. But again we just have to trust management on this, but theres. Also another news that came out and thats that intel has actually made the move that could stop its more technologically advanced peers in their tracks.
What does that mean? Well chinese media outlet. Udn has reported that intel has grabbed the majority of tsmcs 3 nanometer process nodes order for the production of its next generation chips. This basically means that intel will devote this capacity to the gpus and server chips instead of the consumer market cpus, but this could hamper the ability of amd and apple to increase capacity, as neither companies currently operates fabs of its own. So this is another strategic move by intel. They basically know that right now, theyre not yet at the level of tsmc. So basically, what are they doing? Theyre, basically using right now, tsmc but theyre, using all of the remaining production capabilities that tsmcs has to offer, because what will happen if amd or apple needs, more chips? Well, tsmc might not have the time might not have the capability to produce any more, and that means that intel might suddenly win a couple of percent of market share again because those are unable to produce to sell more chips. This is another strategic move that i really like, but obviously amd apple are already very, very big customers of tsmc. Now this in turn will help intel take some time and do what it has to do to obviously improve their own in house capabilities, but its good to see that theyre not afraid to use one of their major competitors to improve their own products. Now last two things remember in my last video.
I said that obviously intel being an american company is going to get the support of the united states government because most of the semiconductor industry right now is located in asia and right now, the geopolitical situation there in taiwan. China is not that great, and so it was announced this week that intel wins the us government project to develop leading edge, foundry ecosystem, its always great, to see an american company getting backed by its own government and, in this case its extremely important that they do So because, well most of the majority of us based chip designers are fabulous, which means that they design and sell integrated circuits that are fabricated by contract manufacturers called foundries and, like i said before, the majority of them are concentrated in asia. So, in the long term, this will help intels foundry services a lot because well american companies might not want to rely heavily on the asian ones. They might rely more on american ones, the same thing for european companies. They might prefer to order a bit more right. Now in the united states than order it or in taiwan or in china or in korea now obviously tsmc and samsung will also be building more in the united states, but again intel being an american company will probably have more advantages. Now before i end this video theres one more thing i want to add – and that is that intel is not afraid to acquire other companies weve seen the rumors of them willing to acquire global foundries for around 30 billion dollars.
Now, last year, global foundry had revenues of 5.5 billion dollars for the whole year, so thats not as much as intel, obviously but its still very, very close to what nvidia is actually doing now. Global fundraiser business is very, very different to what intel amd nvidia are doing. They are basically producing semiconductors for everything else that is not mobile, desktop or laptop, but intel co says that the semiconductor industry will continue to consolidate, meaning that the smaller companies will probably be bought up or merged with the bigger ones. As it says here, there will be a consolidation in the industry. That trend will continue, and i expect that were going to be a consolidator now, obviously, regarding the global foundrys rumors right now, these are just rumors, but this just shows me that management is not going to allow intel to slack anymore. The last couple of years intel has basically done nothing to catch up to its main competitors out there right now. That is changing and what better time to do so than in a cheap shortage, because they know very well that everything thats going to get produced is going to sell, because the demand is very, very high right now now this doesnt mean obviously that md or nvidia Are going out of business or are going to lose billions of dollars because of it? No! On the contrary, this just means that us, the consumer, will suddenly have more choice out there so to conclude: im bullish on intel.
I know very well that this is going to take a long time before my investments actually make sense im. Okay, with that long term. On that position, i dont expect them to become suddenly a 500 or a trillion dollar company overnight. It will take time. Intels foundry services is going to be a huge part of their business and who knows, maybe they might attract apple again in the future. We will see but again intel being an american company is certainly going to help with that, and that will be it for this video. Let me know down in the comments below, if you actually own intel stock, because i think very few of you actually do. I know a lot of you own amd, nvidia sml, but let me know down in the comments below and if you like, this video leave it a thumbs up.