Chip stock Intel (INTC) and Nvidia (NVDA) are perhaps unexpectedly interconnected. Nvidia invested $5 billion in Intel back in December, and now, new reports say Intel is currently working on product collaboration with Nvidia. That news, oddly, sent investors into a panic, and sent Intel shares plunging over 8% in Tuesday afternoon’s trading.
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New trading tool for NVDA bearsSo it turns out that the collaboration Intel has been engaging in with Nvidia never really stopped, and results from this partnership are set to emerge fairly soon. Lip-Bu Tan, while placing a doctoral hood on Jensen Huang during Huang’s receipt of an honorary doctorate from Carnegie Mellon University, revealed that the two companies are still working together to “…develop exciting new products.”
One of the biggest things outside observers are still looking for is the connection between Intel’s system-on-a-chip (SoC) concept and Nvidia’s GeForce RTX graphics processors. That connection should mark a major move from two separate, and occasionally competing, companies into a “unified ecosystem,” one report noted. Nvidia is also looking to incorporate Intel’s Xeon processors with its Grace and Vera CPUs.
A Big Next-Next-Generation
New reports also emerged around Intel’s “next-next-generation” chips, known as the Razor Lake-AX chips. The follow-up to the Nova Lake lineup could put an “on-package memory” system to use. This is still very early-stage stuff, so we may never see this report come to fruition, but the idea of it alone is catching some attention.
The reports also do not confirm what kind of memory will be involved, just where it will be placed. This is also not the first time Intel has had a run-in with on-package memory, reports note. The earlier attempts were not especially cost-effective, nor were they good for margins. But it is a safe bet that something may have changed in the meantime to turn that hypothetical loss around.
Is Intel a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on 11 Buys, 24 Holds and three Sells assigned in the past three months, as indicated by the graphic below. After a 473.76% rally in its share price over the past year, the average INTC price target of $82.70 per share implies 29.74% downside risk.
