To The Moon

$Intel(INTC)$ recently made headlines for its potential $11 billion deal with Apollo for a new chip factory in Ireland. While this might seem like positive news on the surface, I'm taking a cautious approach to INTC.

Intel recently forecasted lower-than-expected revenue and profits for the second quarter. This comes amidst a weak demand for their core data center and personal computing chips. While the chipmaking industry is experiencing a boom, Intel seems to be missing out, particularly in the high-growth AI sector. This combination of declining core business performance and a hefty $11 billion expenditure for a new factory raises concerns about their financial health. With a growing debt burden, it remains to be seen if this investment will pay off in the long run.

The deal with $Apollo Global Management LLC(APO)$ underscores Intel's struggle to keep pace with industry leader $Taiwan Semiconductor Manufacturing(TSM)$. While TSMC has been steadily expanding its manufacturing capabilities, Intel seems to be playing catch-up. This delay could cost them market share and valuable time.

INTC Weekly Chart

For INTC, the bad news seems never-ending, and even positive developments like a new factory come with a hefty price tag. This lack of clear turnaround potential makes me wary of INTC, especially compared to the potential explosive enthusiasm meme stocks like $GameStop(GME)$ and $AMC Entertainment(AMC)$ might offer fueled with just a tweet. Institutional short sellers currently focused on meme stocks might be barking up the wrong tree. INTC, with its seemingly endless stream of bad news and lack of a turnaround strategy, appears to be a much more attractive target for shorting.

INTC only has 1.66% Short Interest % Float

GME has 24% Short Interest % Float

While the picture looks bleak for INTC right now, there's always a chance for a turnaround. However, they need to demonstrate a clear path towards regaining market share, improving core business profitability, and managing their debt effectively. Until then, I'm staying cautious on INTC and would recommend that other investors do the same. There are simply better opportunities out there for those seeking strong financials and a clear path towards future growth.

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Disclaimer: This is not financial advice. Please do your own research before making any investment decisions.