Intel plans Mobileye IPO. What does the stock chart say?
Intel (INTC) – Get Intel Corporation report the stock has clearly been lagging.
Not only does it lag far behind the Nasdaq and S&P 500, but it also lags behind its peers.
Advanced micro-systems (AMD) – Get Advanced Micro Devices, Inc. has made up incredible ground against Intel over the years, while Nvidia (NVDA) – Get the NVIDIA Corporation report continued to dominate as the top semiconductor stock.
Delays to its 7nm chip last year dealt a painful blow to Intel and allowed AMD to gain even more momentum.
At one point, there were hopes that Intel could be a leader in self-driving, especially after its $15.3 billion acquisition of Mobileye in 2017.
However, Nvidia has found a way to direct the charge of self-driving, at least from a chip perspective.
Now looking to unlock value, Intel plans to IPO its Mobileye unit. The spin-off would take place next year and could value the entity at $50 billion.
Initially, Intel stock rose 7.9% on the news, but is currently posting gains of just 4.4%. After Monday’s 3.5% rally, some investors are wondering if it’s time to buy Intel stock.
Trading Intel Stocks
Shares recently fell in October on disappointing earnings, a gap Intel closed today as it pushed towards $55.
Now down from those highs, the bulls are looking to see where the stock finds support.
So far, buyers are intervening near the 200-week moving average. If that metric fails, let’s see if the stock can stay above its November high near $52.
If it can reach this month’s new high near $55, then there could be a potentially big test looming just ahead – technically speaking anyway.
This is in the $56-$56.50 area, where Intel stock finds its 50-week and 200-day moving averages, as well as the weekly VWAP measure.
If Intel manages to clear this area, the stock could rise, potentially putting another big gap at $62.28 into play.
Above that and the $67.50-$70 resistance zone will be the next target, but it’s a long way off. For now, let’s see if the stock can hold the current support.
Remember that Intel shares have been grossly underperforming the broader market and peers. This applies to both long-term and short-term measures.
That’s not to say it can’t rally, but Intel is a proven stock due to its serial underperformance.