Intel Corporation (INTC) jumped roughly 5% in premarket trading Thursday after Bank of America upgraded the chipmaker to Buy from Underperform and raised its price target significantly.
BofA lifted its Intel price target to $135 from $96, citing improved visibility across the company’s server processor and foundry businesses heading into the decade.
The bank now projects Intel delivering earnings power exceeding $6 per share by 2030, a notable increase from its prior estimate of $3 to $4 per share.
Analysts led by Vivek Arya applied a 25x multiple to a 2030 EPS power estimate of $6.24, discounted back two years, to arrive at the updated $135 price target.
The team said its previous sum-of-parts methodology based on 2028 estimates “under-represents many of the company’s CPU and foundry potentials that are further out.”
BofA expects Intel’s CPU sales to top $40 billion by 2030, representing approximately 25% of a projected $170 billion total addressable market.
Arya frames the CPU as a structural winner from the shift toward agentic AI, where the processor moves from feeding GPUs to orchestrating autonomous reasoning loops, memory state, and tool use.
Following discussions with industry executives and customers at the BofA Global Tech Conference, the brokerage raised its global server CPU market estimate to more than $170 billion, up from a prior forecast of $125 billion.
For the foundry business, BofA identified several potential pipeline deals including Apple M-Series wafers, MediaTek TPU wafers, Terafab IP and packaging engagements, and various ARM-based server CPU opportunities.
The bank also highlighted a recent IP collaboration with Cadence on Intel’s 14A node as a step toward building a more sustainable external foundry ecosystem.
Perhaps the most notable catalyst BofA flagged is what it calls a subtle dynamic: Intel’s unusually low institutional ownership relative to its size and market standing.
Despite a market capitalization of around $540 billion, the fifth largest among U.S. semiconductor and AI infrastructure stocks, Intel is owned by just 16% of S&P 500 funds.
That makes Intel the second least-owned stock in the group after SanDisk, a striking gap that analysts believe leaves substantial room for ownership expansion to drive the stock higher.
BofA drew a parallel with AMD, where institutional ownership rose 1,400 basis points over the past year alongside a 309% gain in the stock price.
Intel has been one of 2026’s best-performing stocks overall, surging roughly 210% year-to-date and putting it on pace for its best annual performance since 1975.
CEO Lip-Bu Tan has indicated that Intel 18A yields are running ahead of internal targets and that Intel 14A is already tracking better than 18A was at the same point in development.
CFO David Zinsner confirmed that demand across the business is still outpacing supply, saying the gap between what Intel can ship and what customers want starts with a “B,” meaning billions of dollars.
According to a report from The Information, Alphabet has committed to a three-million-unit TPU order for 2028, representing an estimated 50% of Google’s projected TPU output for that year.
Key risks BofA cited include intensifying competition from Arm-based and custom CPUs, potential moderation in AI capital spending, and execution risk in design and manufacturing at the 18A and 14A nodes.
From a valuation standpoint, Intel trades near 100 times this year’s expected earnings, placing it among the richest multiples across the entire chip sector.
