In late 2022 and early 2023, Intel (NASDAQ:INTC) was in the doghouse on Wall Street. Short-term traders sold INTC stock because Advanced Micro Devices (NASDAQ:AMD) and other chip makers took Intel’s market share. However, there are signs that Intel is faring much better now and could be in the beginning stages of a major comeback.
Along with some notable insider buying activity, there’s big news as Intel invests in a notable artificial intelligence software startup. So, if you want to participate in a high-conviction turnaround story in 2023 and 2024, now’s the time to consider a share position in Intel.
Which Insider Is Buying INTC Stock?
It’s typically a positive sign when a corporate insider buys his company’s shares, especially if this happens multiple times. Hence, it’s encouraging to know that Intel CEO Pat Gelsinger made more than one purchase of INTC stock.
Specifically, Gelsinger (through trusts that he controls) bought 8,200 Intel shares in May, then 7,100 shares in August, followed by 6,775 shares over Oct. 31 and Nov. 1. Clearly, Gelsinger is confident in his company.
It’s hard to blame the CEO for being confident, as beat Wall Street’s earnings estimate in 2023’s third quarter. Impressively, Intel reported non-GAAP earnings of 41 cents per share, up 11% year over year. This result easily surpassed the analysts’ consensus estimate of 22 cents per share.
Intel Could Get Government Funding Soon
Along with the EPS beat, there are other reasons to be confident in Intel’s future prospects. For example, Intel is investing in U.K.-based microchip designer Arm (NASDAQ:ARM).
As you may have noticed, Arm has garnered a lot of attention on Wall Street this year. Recently, Intel disclosed a stake of 1,176,470 Arm American depositary receipts.
Arm designs high-demand chips, including AI chips – and speaking of AI, Intel is reportedly backing Stability AI by leading a new round of financing.
Stability AI is a startup company that’s known for its image-generating software, Stable Diffusion. Thus, as you can see, Intel is investing in leading-edge businesses with high-growth potential.
Intel may be the recipient of a round of government funding. According to a Wall Street Journal report, Intel is the “leading candidate to potentially receive billions of dollars in government funding for secure facilities producing microchips for U.S. military and intelligence applications.”
Naturally, the U.S. military wants to reduce its dependence on microprocessor imports from Asia, and Intel might assist the U.S. government. Prospective and current INTC stock investors should stay tuned for further developments on this ongoing news story.
INTC Stock Is a Great Portfolio Pick for 2023 and 2024
You don’t have to invest in Intel just because Gelsinger is hoarding shares. Insider buying activity can inspire confidence, though. Still, there are plenty of other reasons to believe in Intel’s turnaround story after 2023’s rough start.
There’s no guarantee that Intel will actually receive the aforementioned government funding. Investors should appreciate Intel’s earnings beat and notable investments in high-tech businesses. Therefore, it’s a good time to start a position in INTC stock or add to your stake if you already have one.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
