US semiconductor developer Intel (NASDAQ: INTC) has rallied towards its pre-pandemic highs of 2019 to establish either a double top or a breakout.
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This story originally appeared on MarketBeat
US semiconductor developer Intel (NASDAQ: INTC) has rallied towards its pre-pandemic highs of 2019 to establish either a double top or a breakout. With a long-awaited new CEO, Pat Gelsinger installed and planning to build Chip Fabrication (FABs) facilities right in the US, history is changing as the US infrastructure game. This has boosted sentiment and performance as stocks are up over 37% since the start of the year, not only outperforming the Nasdaq 100, but also up. The Biden infrastructure package aims to strengthen the US supply chains from rare earth materials to clean energy and semiconductors. Considering that 80% of the world's semiconductor production is manufactured by two overseas companies, Taiwan Semiconductor Manufacturing (NYSE: TSM) and Samsung Electronics (OTCMARKETS: SSLNF). The launch of the much-belated Ice Lake SP chips and plans for Meteor Lake, as well as the new research collaboration with IBM (NYSE: IBM) point to the resurrection of the sleeping giant. Prudent investors looking to get exposure to a US semiconductor infrastructure company can monitor Intel's stocks for opportunistic pullback levels.
Company policy update
On March 23, 2021, Intel increased its EPS forecast for the first quarter of 2021 from its previous forecast of $ 1.10, versus consensus analyst estimates of $ 1.11. The company expects quarterly revenue for the first quarter of 2021 for the month ending March 2021 to beat previous projections of $ 17.5 billion, compared to consensus analyst estimates of $ 17.59 billion. However, the company has slashed its full-year 2021 EPS forecast to around $ 4.55 from consensus estimates of $ 4.74 and slashed full-year 2021 revenue to around $ 72 billion versus $ 73.03 billion for analysts . While the strength of the first quarter of 2021 was carried by continued strong demand for notebooks, the industry-wide lack of third-party components and uncertainty about the list of companies were responsible for the cut in estimates. CEO Gelsinger stated, “2021 will be a year of transition as we accelerate Intel development, invest in our future and improve execution. We are working aggressively with our supply chain partners, leveraging our unique manufacturing capabilities to address industry-wide component defects and exceed this guide. "
On March 23, 2021, Intel CEO Pat Gelsinger unveiled the company's integrated device manufacturing model known as IDM 2.0. The company plans to build two new factories in Arizona at a cost of $ 20 billion. This will create 3,000 permanent high-tech and high wage jobs, over 3,000 construction jobs, and approximately 15,000 local long-term jobs. Arizona Governor Doug Ducey and US Secretary of Commerce Gina Raimondo attended the IDM 2.0 event. CEO Gelsinger summed it up, "We're excited to be working with the State of Arizona and the Biden Administration to incentivize this type of domestic investment."
Intel Foundry Services
Intel plans to become a major player and provider of foundry capacity in the US and Europe to serve customers worldwide. The newest factory, Fab 42, on the Ocotillo campus in Chandler, AZ, became fully functional in 2020, processing 10nm chips. The two newly planned factories will also be located on the Ocotillo campus. The start of construction is planned for the end of this year. The factories will be part of a new stand-alone business, Intel Foundry Services (IFS), run by semiconductor veteran Dr. Randhir Thakur is headed. The new business will stand out from competitors who offer process, packaging and capacity commitments in the US and Europe. Intel's IP portfolio is available to customers including x86 cores, ARM and RISC-V ecosystem ips. The company has already received "strong enthusiasm and support from across the industry". The company also expects to add the compute tile for its first 7nm client CPU, Meteor Lake, in the second quarter of 2021. Downplaying the full-year 2021 projections could be an attempt to keep the bar down, but the market is sticking to the infrastructure and turnaround narrative with extremely positive sentiment. Prudent investors need to be patient to avoid the urge to follow up on listings.
INTC Opportunistic Pullback Levels
Using the gun cards on the monthly and weekly timeframes provides a broader view of the playing field for INTC stocks. The monthly rifle card is on the up with rising support for the 5-period moving average (MA) at $ 59.67 with the monthly upper Bollinger Bands (BBs) nearing $ 72.03 Fibonacci (Fib) level. The monthly stochastics are still increasing by the 60 band. The weekly gun card triggered a Low market structure (MSL) Buy triggers above $ 55.95 while Monthly Market Structure High (MSH) triggers below $ 53.60. The weekly rifle card is on an uptrend fueled by a stochastic mini puppy flush shorts that are higher towards the weekly top BBs near the $ 74.58 fib. Stocks are nearing pre-pandemic highs that will either double-top or breakout. Prudent investors can monitor opportunistic pullback levels at $ 65.29, $ 63.53, $ 60.58, $ 58.51, and $ 55.95, respectively. The upward moves range from $ 78.15 Fib to $ 88.03 Fib.