Intel stock price: is this fallen angel a good buy?

on Oct 6, 2022
  • Intel stock price has crashed by more than 50% in 2022.
  • Global semiconductor sales have been falling.
  • The stock will likely continue falling in the near term.

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Intel (NASDAQ: INTC) stock price has been in freefall in 2022 as concerns about the company continued. The shares tumbled to a low of $27, which was its lowest level since August 2015. It has crashed by more than 60% from its highest level in 2021, giving it a market cap of $113 billion.

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Intel is unraveling

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The recent technology news has not been pleasing as interest rates rise. In September, the Nasdaq 100 index plummeted by more than 10%. Semiconductor stocks have done much worse as concerns about demand keep rising. 

There are several reasons why the Intel stock price has crashed this year. First, there are concerns about demand as personal computer sales drop. These sales, which did well during the pandemic, have started cooling as people go back to work. 

Second, with inflation rising, many analysts believe that companies will slow their technology upgrades in a bid to conserve cash. This view was confirmed in the most recent results by Micron, which provided a dim outlook.

Third, semiconductor sales have been in a downward trend this year. A report by the Semiconductor Industry Association said that global semiconductor sales were $47.4 billion in  August. This was a 3.4% decrease from the same period in 2021.

Meanwhile, investors believe that Intel will continue spending more money in the coming years. The company has announced that it plans to build manufacturing plants in the US. This plant in Ohio is expected to cost more than $20 billion. While this plant will benefit from the Chips act, the company will also allocate funds from its balance sheet.

Most importantly, Intel share price has dropped because of the rising competition in the industry. In the past few months, Intel has lost market share from the likes of AMD and Nvidia.

Intel stock price forecast

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intel stock price

So, is it safe to buy Intel stock? The daily chart shows that the INTC stock price has been in a strong downward trend in the past few months. As a result, the stock remains below all moving averages while the Relative Strength Index (RSI) has moved slightly above the oversold level.

It has moved below the important support at $34.43, which was the lowest level on August 9. Therefore, the shares will likely continue falling as sellers target the next key support at $20. In the long term, however, the stock will likely rebound.


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