HSBC downgraded Intel (INTC) to “Reduce,” citing the lack of a solid foundation for the chipmaker’s recent 50% rally due to investment announcements from SoftBank, the U.S. government, and Nvidia totaling $18.1 billion. Intel’s struggles in its foundry division remain a concern, prompting HSBC to set a new price target of $24.

Intel’s recent stock surge is mainly fueled by major investments from the U.S. government, SoftBank, and Nvidia, totaling billions. Yet, these deals don’t address Intel’s core manufacturing challenges, especially in its foundry business. New CEO Lip-Bu Tan is focused on securing external customers to justify investments in its 14A manufacturing node.

Intel is in talks with AMD to potentially manufacture chips for the rival, highlighting the urgency for a major foundry customer. The company announced its new Panther Lake processor, set to launch in laptops next year, but still lags in cutting-edge chip tech. Analysts project revenue to increase from $52 billion in 2025 to $70 billion in 2029, with adjusted earnings rising from $0.12 to $2.65 per share in the same period.

With INTC stock forecasted to trade around $53 in early 2029, representing a 45% upside, investors face mixed recommendations. Out of 41 analysts, two suggest “Strong Buy,” 34 recommend “Hold,” and five advise “Strong Sell.” The average price target is $26, below the current price of $38.

Read more at Yahoo Finance: The INTC Rally Is ‘Unsustainable’ So You Should Sell Now