A while back, we heard that chip stock Intel’s (INTC) earnings report may not be especially valuable, due to a variety of factors. Instead, investors were advised to consider the Foundry Day reports instead. Those reports have recently arrived, and there is a pretty positive outlook that comes with them. Sufficiently so, in fact, that Intel shares notched up fractionally in Tuesday afternoon’s trading.
Intel, the reports noted, wants to create an “engineering-first culture,” which gets away from bureaucracy as much as possible while also improving its own production capabilities. The recent Direct Connect event spelled out just what Intel is doing in that vein, and what that may mean for Intel’s future overall.
One of the biggest things on the list is an improvement in process technology. Already, Intel Foundry is working on the creation of 14A process technology, which is set to be the eventual successor to the 18A process. Early versions of the 14A Process Design Kit (PDK) are already arriving for lead customers, and several are planning to build test chips accordingly. The 14A process will include PowerDirect direct contact power delivery systems as well. Meanwhile, 18A is expected to hit volume production by the end of this year, giving Intel a complete road map of process technology for the next few years.
“Smaller, Faster, Better”
And it did not stop there, either. While 18A is still rolling out, Intel also revealed a variation of the 18A process known as 18A-PT. The 18A node already had one variant, the 18A-P extension, which was starting to run through fabrication processes. The 18A-PT variant, meanwhile, is set to provide still more value for Intel.
Further, the 18A-PT variant will offer support for Foveros Direct 3D, reports note. That will allow Intel to stack its dies vertically. This may not sound like much, but reports note that it will allow Intel to compete directly with Taiwan Semiconductor (TSM). Taiwan Semiconductor has had this capability for some time now, but now, with 18A-PT, Intel will be able to match their output.
Is Intel a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 28 Holds and four Sells assigned in the past three months, as indicated by the graphic below. After a 31.8% loss in its share price over the past year, the average INTC price target of $21.04 per share implies 2.46% upside potential.
