Intel Shares Jump Following Rare Double Upgrade

Intel shares (NASDAQ: INTC) are up 4.77% in trading at the open, after Bank of America delivered a rare double upgrade, moving the semiconductor giant from Underperform directly to Buy while raising its price target to $135 from $96, marking a dramatic reversal from one of the stock’s most prominent skeptics.

The Intel share price sits at $112.20 into the open, a welcome bounce after a 17.3% pullback over the past month. Despite the near term pullback, INTC has been on a remarkable run that has seen the stock add 171% since the start of the year, with analyst upgrades further boosting sentiment. The $135 price target from BofA now sits at the upper end of Wall Street’s range, suggesting meaningful upside if the firm’s thesis plays out.

BofA’s move from Underperform to Buy skips the typical intermediate Hold rating, signalling conviction in a structural change rather than incremental improvement.

AI Workloads and Foundry Drive Upgrade

Bank of America’s upgrade centers on two interconnected themes: Intel’s emerging role in addressing industry constraints at the leading edge of semiconductor manufacturing, and a fundamental shift in AI workload architecture that favours central processing units over graphics processing units for certain critical tasks.

The firm now projects Intel’s integrated device manufacturer model, combining its product business with its foundry services, could generate more than $6 in earnings per share by calendar year 2030, up from its previous estimate of $3 to $4. This doubling of long-term earnings power reflects BofA’s increased confidence that Intel can capture meaningful share of both the advanced packaging market and what the firm describes as a “much larger agentic CPU market.”

The concept of agentic AI has emerged as a key bull case for Intel across multiple recent analyst notes. Unlike pure inference or training workloads that run predominantly on Nvidia GPUs, agentic workflows require significant CPU resources for task management, data movement, and system coordination. Multiple Wall Street firms now argue this architectural shift could reverse the traditional CPU-to-GPU ratio in AI servers from roughly 1:8 to something closer to 8:1 in certain deployment scenarios.

BofA’s upgrade also reflects growing confidence in Intel’s foundry strategy, particularly its ability to provide advanced packaging services and leading-edge wafer capacity to external customers. The firm sees Intel helping to alleviate industry-wide constraints in these critical areas, potentially driving higher utilization rates and improved operating leverage over the medium term.

However, BofA emphasized that execution remains paramount. The firm explicitly noted that both product and foundry execution “remains key” to achieving the $6-plus earnings power scenario, acknowledging that Intel’s roadmap must proceed largely without major setbacks.

Upgrades Build Momentum

Price Targets

BofA’s move caps a steady drumbeat of increasingly constructive analyst actions over the past two months that have collectively reshaped Street sentiment on Intel.

In late April, Evercore ISI upgraded Intel to Outperform from In Line and raised its price target to $111 from $45, citing improved execution under new leadership and arguing that the fastest-growing AI workloads are becoming more CPU-intensive. The firm highlighted geopolitical factors favoring U.S.-centric manufacturing as an additional tailwind for Intel’s domestic production footprint.

Near-Term Challenges

Despite the improved sentiment, Intel continues to face near-term profitability headwinds that keep some analysts cautious. The company’s gross margin remains well below its historical norm of 60%-plus, hovering around 40% as it invests heavily in new process nodes and manufacturing capacity. Intel is also burning cash as it executes its ambitious capital expenditure program to build out foundry capacity and advance its process technology roadmap.

The company’s first-quarter results exceeded expectations, with revenue and earnings beating the high end of guidance ranges. Management raised second-quarter guidance above Street expectations, driven by stronger-than-anticipated demand for both server and client processors. However, the gross margin trajectory remains a key focus for markets, with sequential compression expected in the near term before improvement materializes as newer nodes reach volume production and mix improves.

Intel’s foundry business, while central to the long-term bull case, remains unprofitable and represents a significant drag on consolidated earnings. The company has secured some external foundry customers and continues to tout progress on its roadmap, but material third-party revenue remains largely a future story rather than a current reality.

BofA’s upgrade represents a high-profile validation of the bull thesis, but the firm’s explicit caveat that execution “remains key” underscores that this is still largely a show-me story rather than an accomplished turnaround. Markets will be watching upcoming product launches, quarterly gross margin trends, foundry customer announcements, and progress on the 18A node for evidence that Intel is delivering on the ambitious roadmap that now underpins increasingly bullish Street views and a doubled long-term earnings outlook.