Intel’s Surge and Future Prospects: Analyzing the Semiconductor Giant’s Path to 2025

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Intel (NASDAQ:INTC) shares have had a great run recently. Over the last year, they’ve climbed from $28 to $43 as demand for semiconductors – and interest in artificial intelligence (AI) investing – has picked up. Here, we look at what Intel shares could be worth in 2025. Let’s dive in.

What will Intel shares be worth in 2025?

It’s never possible to know exactly what a stock’s price will be in the future. However, we can make predictions. One way to do this is to project future earnings per share (EPS) and then apply an earnings multiple to obtain a stock price. This approach isn’t perfect. However, it’s a good place to start.

Forecasting Intel’s 2025 stock price

For 2025, the consensus EPS forecast for Intel is $2.24 per share. Let’s assume this is an accurate forecast (it may not be).

Now, we need to work out the right multiple to apply to this EPS figure. This is the hard part. In today’s digital world, in which demand for semiconductors is rising rapidly, Intel appears to have a lot of growth potential (in 2025 revenue is projected to grow 12% year on year). So, it could deserve an above-average earnings multiple.

Intel Corporation Share Price (INTC) Quote & Overview

On the other hand, the company has experienced some execution issues recently. For example, in January, it provided Q1 revenue guidance that was below estimates. So, perhaps it deserves a below-average multiple.

To keep things simple, I’m going to apply the average S&P 500 earnings multiple of 18 to the stock. Multiplying $2.24 by 18 we get a stock price of approximately $40.30. That’s a little below the current share price.

What’s the fair value of Intel shares?

Now, a multiple of 18 could be too high. After all, for much of the last decade, Intel has traded at lower valuations. However, I think that multiple is fair and that a price of $40 is the fair value.

It’s worth noting that several brokerage firms have price targets around this level. For example, Wedbush has a price target of $40 while Goldman Sachs has a price target of $39. Research firm Morningstar also has a price target of $40. It sees that price as the fair value.

Some brokers have higher price targets. For instance, Wells Fargo and Mizuho have price targets of $48 and $55 respectively. The average price target, however, is around $42, according to LSEG data.

How high will Intel stock go?

As for how high Intel stock can go, it’s hard to know. It will depend on several factors including future earnings growth and sentiment towards the stock.

As I mentioned earlier, recent results were not great. Guidance for the first quarter of 2024 was weak. This has had a negative impact on the share price.

If the company can improve its performance and post better-than-expected results, however, sentiment towards the stock could improve. This could see the share price rise back above $50 and maybe even approach the $60 level.

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