Two of the semiconductor companies with the worst prospects are on the rebound. Intel (INTC) traded as low as $24.59 before rebounding to the low $30s. Micron Technology (MU), which sells memory chips, faces severely weak demand.
Neither stock has more upside than the other. They are rallying for different reasons.
Intel hosted an investor event to showcase its new chipsets designed for data centers. The CPU developer does not have a compelling AI computing offering compared to that Nvidia (NVDA). At its low valuation, speculators are willing to bet that INTC stock cannot fall further.
Micron posted weak results on March 29, 2023, yet shares gained more than 7% that day. Markets are speculating on a semiconductor recovery. They believe that the data center market will improve. The AI-driven demand will increase sales of memory chips. Additionally, analysts speculate that in the PC and smartphone market, inventory is at the bottom of the cycle.
Demand for PC parts is unlikely to recover. The industry will sell the excess inventory at retail prices and without price cuts. That should help Intel and Micron lose less money.
Job cuts from both companies will help balance lower supply with weaker demand.
Add Micron and Intel stock to the investing watch list.
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