To The Moon

Intel Pole-Vaults Over Amazon to be Fourth Most Active Stock Option

$Intel (INTC.US)$ pole-vaulted over $Amazon (AMZN.US)$ to become the fourth most active stock option Thursday after the semiconductor company named a new chief executive officer, sending shares climbing almost 15%.

Former $Cadence Design Systems (CDNS.US)$ CEO Lip-Bu Tan, who will take the helm at Intel beginning March 18, vowed Wednesday to remake the company, telling its employees “I’m confident we can turn our business around.”

Almost 1.3 million call and put options changed hands. That surpassed Amazon's options volume of 587,340 contracts. Only $NVIDIA (NVDA.US)$, $Tesla (TSLA.US)$ and $Apple (AAPL.US)$ recorded higher options volume. 

Shares of Intel climbed to $23.70, bolstering the odds that many of the call options could be in the money before expiration. Call options that give the holders the right to buy the stock at $24 by tomorrow attracted the heaviest volume as shares climbed above that strike price in the first 30 minutes of trading. 

Thursday's share price gain adds to the stock's 4.6% advance Wednesday after Reuters reported that $Taiwan Semiconductor (TSM.US)$ pitched to Nvidia, $Broadcom (AVGO.US)$, $Advanced Micro Devices (AMD.US)$ and $Qualcomm (QCOM.US)$ a joint venture that would operate Intel's factories. In February, Bloomberg reported that TSMC was considering taking a controlling stake in Intel's factories at the request of Trump administration officials. 

Reports of a potential Intel breakup were fueled by the slow grind in the company's turnaround efforts. In January, it forecast that revenue for the first quarter will reach $11.7 billion to $12.7 billion, missing the average analyst estimate of $12.85 billion amid weaker demand and market share losses to rivals. 

The company's revenue shrank to $53.1 billion last year from $79 billion in 2021 as the chipmaker trailed its rivals in the race to meet surging demand from artificial intelligence applications. The stock has traded below its book value for much of the past three months. While it has since rebounded, it’s still at 1.04X book value, down from 3.28X in the first quarter of 2021, data compiled by Bloomberg show. 

 "We view Tan's appointment positively, given his strong industry background and previous familiarity with INTC's operations,” CFRA analyst Angelo Zino wrote in a note late Wednesday. “His immediate challenges include deciding whether to maintain INTC's integrated structure or pursue a break-up strategy, with our belief that staying the course and focusing on the foundry business model with 18A technology is the optimal path forward.”

Even deep-pocketed investors and large speculators are piling onto bullish option block trades. The biggest transaction so far was posted at 10:20:46 a.m., when an active buyer paid a $2.2 million premium for call options that give the holder the right to buy 750,000 Intel shares at $30 each by Jan. 16, 2026. 

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