The veteran chip stock is losing its membership in the Dow.
For the second time in 2024, the Dow Jones Industrial Average (INDEXDJX: .DJI) is getting a shakeup. Back in February, Amazon replaced Walgreens on the stock market index.
Nvidia will soon replace Intel in the Dow Jones Industrial Average, ending INTC's 25-year run of underperformance in the index. NVDA's recent market outperformance suggests investors are getting pumped up for its upcoming earnings release later this month. Recent earnings releases from AMD and Intel show that the King of AI's market leadership remains structurally bullish.
Investors have been discouraged from purchasing Intel stock because of its poor performance in recent years.
Intel Corp NASDAQ: INTC has endured a tough year, with its stock losing as much as nearly 65% due to red-hot competition and declining earnings. However, in recent weeks, the stock has been consolidating and has even started to show signs of rally potential.
Investors want to know what these latest developments mean for shareholders.
Intel (INTC) has been one of the stocks most watched by Zacks.com users lately. So, it is worth exploring what lies ahead for the stock.
Nvidia is set to replace Intel in the Dow Jones Industrial Average.
NVIDIA Corp (NASDAQ:NVDA, ETR:NVD) will replace Intel Corp (NASDAQ:INTC, ETR:INL) in the Dow Jones Industrial Average this week in the latest shake-up of the Wall Street index. Intel has been one of the DJIA's 30 constituents since 1999, when it and Microsoft became the first companies traded on the Nasdaq exchange to be included as part of the 128-year-old benchmark.
The company will join the blue-chip index this week, further cementing its position as the leading U.S. chip stock.
Intel reported worse-than-expected Q3 results, driven by non-recurring charges. The top line beat estimates, however, and the Q4 outlook is solid. Intel has likely seen the worst already, with a $16.6B quarterly loss in Q3. Sentiment is so strained, that despite $18.5B in impairment and restructuring charges, Intel's share price rallied 8% after earnings.
Intel's stock price saw a slight recovery after a drastic crash experienced YTD. The management takes action to restructure the business and provides a promising outlook on the years to come. My conservatively derived price target offers an upside potential with a sufficient margin of safety.