Why Intel Stock Popped Today
Key PointsAI agents are creating a greater need for the types of central processing units Intel makes.
Intel's stock soared on Monday, climbing by 4% after optimistic analyst commentary and a promising acquisition announcement. Analyst Pierre Ferragu from New Street Research advised potential investors to consider purchasing Intel shares. He anticipates the company's stock price to soar 38% to $125, fueled by heightened interest in agentic AI applications and a subsequent surge in central processing unit (CPU) sales.
Ferragu believes that the demand for server CPUs will steadily rise, due to supply shortages expected to continue for years. He predicts Intel can expand its server capacity by over 50% by 2027, which could lead to an increase in data center and artificial intelligence (AI) related revenues surpassing Wall Street's predictions. Furthermore, Ferragu estimates Intel's server CPU sales will reach $50 billion by 2030, outpacing the overall market which is anticipated to exceed $220 billion.
He projects Intel could generate $7.10 in earnings per share by then, a significant jump from the current consensus estimate of roughly $1.50 in 2026. Later in the trading day, Intel disclosed it had finalized a deal to acquire quantum computing software developer Classiq. By merging Classiq's comprehensive software with its manufacturing operations, Intel aims to simplify the process of scaling quantum computing platforms.
According to Classiq CEO Nir Minerbi, the collaboration between Intel and Classiq could expedite the adoption of quantum computing and help unlock its benefits sooner.
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