Intel (NASDAQ: INTC) has been downgraded by HSBC to ‘Reduce’ from ‘Hold’, with a new price target of $24, up from $21.25.
The adjustment follows a significant surge in Intel’s stock, which has risen 55% since August, driven by substantial investments from major entities. As of press time, INTC was trading at $37.05, having rallied almost 85% year-to-date.
The downgrade reflects concerns over the sustainability of Intel’s recent rally. Notably, the surge is attributed to significant investments from SoftBank, Nvidia (NASDAQ: NVDA), and the U.S. government.
Despite the influx of capital, HSBC analyst Frank Lee cautioned that Intel’s long-term recovery depends on its ability to execute its fabrication operations effectively.
The bank noted that the recent stock appreciation may be overdone and urged investors to remain cautious about the company’s ability to sustain growth without substantial operational improvements.
Intel’s capital inflow
Among the investments, in August 2025, the Donald Trump administration converted $11.1 billion in CHIPS Act grants and Secure Enclave program funding into a 9.9% equity stake in Intel. The government purchased 433.3 million shares at $20.47 each, below the market value at the time.
The investment was structured as passive ownership, with no board representation or governance rights, and included a five-year warrant to acquire an additional 5% of Intel’s shares, contingent on the company maintaining control over its foundry operations.
Meanwhile, In September 2025, Nvidia announced a $5 billion investment in Intel, purchasing Intel common stock at $23.28 per share. This move makes Nvidia one of Intel’s largest shareholders, acquiring approximately 4% of the company.
The partnership aims to develop custom data center and personal computing products, integrating NVIDIA’s GPUs with Intel’s CPUs to enhance AI and computing capabilities.
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