I Bought Intel at $19, and Now the Stock Just Plunged 29%: Is INTC Cheap Yet?
We bought Intel at $19.50 and sold too early. After its worst single-day drop since 1974, is INTC finally cheap, or still expensive? Here is what went wrong, what could go right, and the price levels to watch.
Mikirduit – We bought Intel (NASDAQ: INTC) at $19.50 per share on February 6, 2025. Our plan was always a swing trade, and we took profits at $23.90 for a 22.56% gain.
Key Takeaways
- Guidance, not results, triggered the plunge. Intel’s Q4 2026 revenue outlook of $15.5 billion came in about 9% below consensus, and its non-GAAP EPS guidance of $0.25 was 43.2% below. Weak PC demand and a production halt in Israel drove the cautious forecast.
- Data center demand is strong, but supply is the bottleneck. DCAI revenue jumped 77.8% to $7.32 billion in Q3, yet a shortage of advanced substrates could limit growth until the second half of 2027.
- The chart points to more downside risk, not a clear bargain. INTC could trade sideways between $55 and $70, with unfilled gaps at $44.25 and $25.03. Swing traders may find setups, but long-term investors should weigh the risks first.
If we hadn’t stuck to that plan, our position would have been up 642% at the peak in June 2026. Even after the steep drop on October 30, 2026, it would still be a double. But that doesn’t bother us. We stay disciplined and follow the plan we set. So, can traders start looking at INTC again?
Why We Bought Intel in 2025
Back then, we entered the stock because of two things: Intel’s expansion plans and its expected recovery, despite ongoing layoffs. Some analysts believed Intel could stage a turnaround in 2025 or 2026.
- 2025 estimates: Among 19 analysts, earnings per share (EPS) forecasts ranged from a loss of $0.90 to a profit of $0.42.
- 2026 estimates: Among 20 analysts, forecasts ranged from a loss of $0.65 to a profit of $1.30.
Several factors supported the bull case:
- Intel Foundry recovery. Intel planned to begin high-volume production of Intel 16 in Ireland, its main manufacturing site in Europe. It was also installing equipment at Fab 52 in Arizona to support higher output of Intel 18A.
- Government funding. Intel signed a definitive agreement with the U.S. Department of Commerce for $7.86 billion under the CHIPS and Science Act, to be used for research and development.
- Policy tailwinds. Donald Trump’s election looked like an opportunity for Intel, which was planning to close a factory in China. If a U.S.-China trade war escalated, Intel would be among the best prepared, while rival Nvidia (NVDA) was concerned about restrictions on using TSMC as its chip supplier.
- Quantum computing. Intel was also building a partnership with the Japanese government to develop next-generation quantum computing.
There were negatives too. Intel had cut roughly 23,000 jobs over two years, shrinking its workforce by 17%, and management planned to cut another 15% of staff. That mix of positives and negatives is why we chose to swing trade rather than hold for the long term.
The Worst Drop Since 1974
On Friday, October 30, 2026, Intel shares fell as much as 29% intraday. That was the worst single-day decline since July 5, 1974, surpassing the shock of August 2, 2024. The question now is whether the stock is on sale and can climb back to $141. You can read more in our breakdown of why AI stocks slid after Big Tech earnings.
What Went Wrong
Shares tumbled after Intel’s earnings report because management guided fourth-quarter 2026 results well below analyst expectations.
| Metric (Q4 2026 guidance) | Intel guidance | Consensus | Gap |
|---|---|---|---|
| Revenue | $15.5 billion | $17 billion | About 9% below |
| Non-GAAP EPS | $0.25 | $0.44 | 43.2% below |
CFO David Zinsner pointed to several reasons for the conservative outlook.
First, Weak PC demand. Revenue in the Client Computing and Physical AI Group (CCPG) is expected to fall more than 20% quarter over quarter in Q4 2026. Intel expects global PC unit sales to drop 12% in 2026, with volumes down more than 20% in the second half. For 2027, it expects another 10% decline.
The cause is a surge in memory prices. Tight memory supply is making PCs more expensive, which is slowing demand from both consumers and businesses. PC makers, who are Intel’s customers, are drawing down inventory faster and cutting processor orders to match weaker 2027 forecasts. Intel expects the pressure to be heavier in the first half of 2027, with a possible improvement in the second half.
Second, An accident in Israel. In October 2026, an accident at Intel’s Kiryat Gat facility in Israel caused fatalities and injuries and halted production for about two weeks. Management estimates the disruption could cut revenue by about $300 million in Q4 2026 and another $300 million in Q1 2027, roughly $600 million in total. Gross margin could also fall by about 2 percentage points in Q4. Most of the impact relates to server processors built on the 10 nm process.
Surya Rianto
A Bright Spot: Data Center and AI
Intel’s Data Center and AI Group (DCAI) is growing fast. In Q3 2026, DCAI revenue rose 77.8% year over year to $7.32 billion, while operating profit jumped about 215% to $3.04 billion.
The problem is supply, not demand. Server processor demand now exceeds what Intel can produce. Zinsner said full-year 2026 DCAI revenue is expected to be nearly $10 billion higher than the company’s internal forecast at the start of the year. That figure reflects higher revenue projections, not backlog.
Intel faces several production constraints:
- Substrate shortage. Advanced organic substrates, which are used in packaging technologies such as EMIB, are in short supply. Intel plans to expand substrate capacity by about 40%, but most of that capacity is not expected to contribute until the second half of 2027. Supply could stay tight through the first half of 2027.
- Yield challenges. Intel is also working to improve yields and manufacturing efficiency on its Intel 3 technology.
These constraints could lead to delayed shipments, higher work-in-process inventory, greater working capital needs, and higher packaging costs. These are risks to monitor, not outcomes that have all been confirmed.
The bottom line: the main risk for DCAI is not a lack of customers but Intel’s ability to ramp production and deliver on time. If supply stays tight longer than expected, revenue growth could stall. If new capacity arrives on schedule in the second half of 2027, Intel could turn strong demand into much higher sales and profit.
Technical Outlook
From a technical standpoint, INTC could trade sideways between $55 and $70 per share over the medium term. The October 30, 2026 decline also closed the price gap that opened on April 23, 2026.
In a worst-case scenario, several unfilled gaps remain below the current price. The nearest is the March 30, 2026 gap at $44.25. The deepest is the September 17, 2025 gap at $25.03.
Further negative news could extend the pressure on the stock. Two catalysts to watch are a potential Federal Reserve rate hike and Q4 2026 results that fall short of even Intel’s lowered expectations.
Our Take
Now may not be the right time to open a new position, unless you see a compelling setup for a swing trade. For longer-term investors, several fundamental risks remain, including weak PC demand, supply constraints, and the production disruption in Israel.
Mikirduit US provides independent financial research and educational content. This article is not personalized investment advice, and investors should conduct their own research before making investment decisions.
