Intel stock gains as Baird sees Nvidia partnership as positive catalyst

Investing.com - Intel (NASDAQ:INTC) stock is rising following Baird’s positive assessment of the chipmaker’s newly announced partnership with Nvidia (NASDAQ:NVDA). The stock, which has delivered a strong 24.19% return year-to-date, continues to show momentum as a prominent player in the Semiconductors industry. According to InvestingPro data, Intel currently commands a market capitalization of $145.27 billion.

The research firm called the collaboration "incrementally positive" for Intel, noting it will likely promote market share gains and foundry revenue growth. Under the agreement, Intel will build custom x86 CPUs for Nvidia, while also manufacturing and selling x86-based SOCs integrating Nvidia’s RTX GPUs for personal computing. With an overall Financial Health Score of FAIR from InvestingPro, Intel shows promising potential despite current challenges in profitability.

As part of the deal, Nvidia will purchase $5 billion in Intel’s common stock at $23.28 per share. Baird highlighted that the partnership validates x86 processors as beneficiaries of GPU-generated AI tokens and represents a TAM expansion for Nvidia beyond its ARM-based CPU initiatives.

The firm’s industry checks suggest Intel’s A14 current yields are promising, adding confidence to potential second half 2026 production. Baird believes this development itself is likely to benefit Intel’s x86 market share.

The collaboration between the two computing leaders with their respective x86 and GPU ecosystem-leading platforms has "powerful and longer-term positive implications for future joint-architecture developments," according to Baird, which sees the deal as "a clear win for Intel’s CEO" in securing a flagship manufacturing client. While Intel appears overvalued at current levels based on InvestingPro’s Fair Value analysis, analysts project the company will return to profitability this year. For deeper insights into Intel’s valuation and 12+ additional ProTips, explore the comprehensive Pro Research Report available on InvestingPro.

In other recent news, Intel Corporation has been upgraded by Wedbush, which sees potential for the company to become a significant player in the artificial intelligence sector. This upgrade is based on Intel’s position in the growing AI infrastructure market, projected to reach up to $4 trillion by the decade’s end. Additionally, Intel has entered a $5 billion partnership with Nvidia to develop custom data center and PC products, with Nvidia investing in Intel’s common stock. This collaboration aims to integrate Nvidia’s AI technologies with Intel’s CPU capabilities.

Meanwhile, Truist Securities has reaffirmed its Hold rating on Intel, maintaining a $21.00 price target, while noting the company’s ongoing but uncertain recovery efforts. In leadership news, Intel announced that Michelle Johnston Holthaus will step down from her CEO role at Intel Products but will remain in a non-executive capacity until March 2026. Furthermore, Intel has made several senior leadership appointments, including the addition of Kevork Kechichian as executive vice president and general manager of the Data Center Group. These developments reflect Intel’s strategy to strengthen its core business and foster an engineering-focused culture.

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