Insider trading activity is a fun metric to watch. It can provide investors with some important real-time insights about how a given management team feels about the company they’re in charge of. In the case of Intel (NASDAQ:INTC), a stock that’s dropped around 35% this year alone, this metric may be more closely watched than with other companies. Today, INTC stock is up slightly on news that the company’s CEO, Pat Gelsinger, has been buying up shares of the company he manages in the open market.
This move is intriguing, as many in the market appear to be discounting Intel as a chip player that is likely to continue losing market share over time. In the high-performance computing market, Nvidia (NASDAQ:NVDA) and AMD (NASDAQ:AMD) are clearly taking the lead. And while Intel still holds a solid market share in the PC market and other key segments, it’s clear that investors want to see the kind of growth its competitors are offering right now.
The thing is, some value investors are starting to pick up shares of Intel on this recent dip. And Pat Gelsinger is one of the most well-known names in the C-Suite. Accordingly, when he makes a move like this, others are likely to follow.
Let’s dive into the size of these transactions, and what it may mean for intel investors.
INTC Stock Higher on Reports of Insider Buying
Pat Gelsinger reportedly added to his stakes, which he owned personally and through trusts, in recent days. On April 29 and May 1, Gelsinger purchased 8,100 shares for roughly $250,000. This adds to the CEO’s stake, which now amounts to 146,690 shares worth roughly $4.5 million at current prices.
That’s a sizable investment for any individual and speaks to the bullish sentiment those managing Intel have on its future. The company is undertaking massive capital investments to bring chip production increasingly to the U.S. market. Intel is widely expected to be a key beneficiary of Chips Act spending and could certainly have a bright long-term future.
The thing is, investors appear to remain focused on higher-end chips, with rivals Nvidia and AMD much more in the spotlight. Capital has rotated out of Intel and into some of its peers, evidenced by the stock’s vast underperformance this year.
I think Intel represents an intriguing turnaround story and one that could have legs if the geopolitical climate continues to heat up. We’ll have to see if Gelsinger’s purchases around current levels work out over the long term. But it’s a strong vote of confidence, and investors will clearly take it.
On the date of publication, Chris MacDonald 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.
