Why is Intel stock rallying today?

Intel (INTC) shares rose 4% after JPMorgan upgraded it to Neutral from Underweight, citing a more balanced risk-reward outlook. The firm maintained a $85 price target. Intel also announced a chip manufacturing agreement with Tesla (TSLA) using its 14A process. Intel's 18A production is ahead of internal targets, and JPMorgan noted potential AI-driven demand for its products.

Intel (INTC) stock rose over 4% in pre-market trading after J.P. Morgan upgraded its rating to Neutral. Analyst Harlan Sur cited a more balanced risk-reward profile, with a $85 price target. Intel is expected to report Q3 earnings on October 29, with EPS forecast at $0.40 and revenue at $16.50 billion. Sur noted Intel's market share declines but sees potential in AI and custom chips.

ASML reports strong demand for chip equipment upgrades, with Q3 service sales at €3.3B, exceeding guidance. The company expects supply shortages to persist, driving growth in memory and logic net system sales. Intel and Micron are also investing in upgrades and expansions. ASML plans to increase production capacity and has completed pricing discussions for 2027-2028. Upgrades and expansions aim to boost output and profitability.

Nvidia launched AI-powered PCs with partners like Dell and HP, starting at $2,599. The PCs use Grace and Blackwell chips, targeting Intel and AMD in the PC market. Nvidia aims to integrate hardware and software, expanding its CUDA environment. Success is uncertain due to high price and performance limitations.

JPMorgan upgraded Intel (INTC) from Underweight to Neutral with a $85 price target. The stock has fallen 36% from its June peak but is up 143% year-to-date. Intel's market share in server and PC CPUs has declined, but JPMorgan notes improvements in execution and manufacturing. Analysts predict profitability in 2026 with earnings of $1.51 per share. Other analysts have raised or initiated price targets, citing partnerships and AI-driven demand.

Intel CEO Lip-Bu Tan reports 80% completion of corporate overhaul, with stock up to $90 from his tenure start. The company faces long-term challenges in foundry competition, with significant investments from the U.S. government, Nvidia, and SoftBank. Tan emphasizes the need for sustained capital spending and government support for future growth.