Morgan Stanley resets Intel stock price target ahead of earnings

Intel (INTC) stock has gained approximately 78% year to date, trading at $65.83 at the time of writing, Tuesday afternoon, April 21, according to Yahoo Finance. Meanwhile, the SPDR S&P 500 index (SPY) is up close to 3.4% over the same period.

The stock’s gains are very impressive, especially given what happened after its Q4 earnings report on Jan. 22. The company’s Q1 guidance disappointed investors, and the stock tumbled the following day, closing at $45.07, or 17.03% lower.

Stock’s serious gains started in April. The sentiment that CPUs are the next important thing for AI infrastructure buildout started to grow after reports in March. Both AMD and Intel have reported a surge in CPU demand, as reported by Tom’s Hardware. Additionally, Bank of America raised its CPU sales forecast.

The company will report its Q1 2026 earnings on April 23, 2026, and the expectations are high.

But more importantly, Intel reported three key developments that boosted the stock. Intel’s CEO, Lip-Bu Tan, who has led the company since March 2025, showed once again that he can turn things around, just as he did when he secured significant investments last year. 

Intel’s key strategic deals

Intel and Apollo (APO) shared on April 1 that Intel will repurchase the 49% equity interest in the joint venture related to Intel’s Fab 34 in Ireland, not held by Intel, for $14.2 billion. The company plans to fund the deal with existing cash and approximately $6.5 billion of new debt.

On April 7, Intel revealed it will join Elon Musk’s Terafab AI chip complex project with SpaceX and Tesla (TSLA), reported Reuters. The company will make processors powering Elon Musk’s robotics and data-center ambitions.

Related: Goldman Sachs resets Broadcom stock forecast

On April 9, Intel and Google confirmed a multiyear partnership to build out AI and cloud infrastructure. Google Cloud will continue to deploy Intel Xeon processors across its workload-optimized instances, including the latest Intel Xeon 6 processors powering C4 and N4 instances.

The companies also expanded their co-development of custom, application-specific integrated circuit (ASIC)- based infrastructure processing units (IPUs). IPUs are used to offload networking, storage, and security functions from host CPUs, thereby improving utilization and efficiency.

Morgan Stanley doubts Intel can gain market share by having fabs.

Picture alliance/Getty Images

Morgan Stanley raises Intel stock price target

Morgan Stanley analyst Joseph Moore and his team updated their opinion on Intel stock ahead of earnings.

The team said it was challenging to estimate how the trend of CPUs becoming a more substantive part of the AI surge will affect the stock.

They said their global team has landed on a longer-term growth rate for CPUs of 30% to 40%, which is much higher than historic rates but still below expectations compared with GPUs. It seems unlikely that the company can gain market share by having fabs, they noted.

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“We do expect some initial indications of interest, but prospects for a positive [discounted cash flow] foundry business remain remote, in our view,” Moore wrote. “That said, we are somewhat intrigued by the Terafab relationship, and are curious to see what the economics of that partnership may look like.”

Analysts raised their estimates for Intel’s 2027 EPS up to $1.34 from $0.97. They noted that their estimates are now approximately 20% above consensus.

In a research note shared with TheStreet, Moore reiterated an equal-weight (hold) rating for Intel stock and raised the price target to $56 from $41, based on a 42x multiple of his 2027 EPS estimate of $1.34. He said the multiple is “above the high end of the large cap logic semi peer group, reflecting high leverage potential on numbers that are still depressed, and foundry optionality, despite our longer term skepticism.”

Intel upside risks:Foundry partnerships de-risk the story and further improve the multiple.The company regains lost share in desktop and server following CPU shortages.Intel downside risks:AMD competition becomes more significant, leading to further market share losses in CPUs and pressure on average selling prices.Minimal success in the foundry leads to an inflated cost structure.

Related: Bank of America revamps AMD stock price target

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