Intel Corp’s (INTC.O) shares hit their highest in nearly two decades on Friday after cloud computing demand fired up the chipmaker’s data center business and allayed concerns of market share loss to rival AMD, lifting stocks across the sector, Trend reports citing Reuters.
At least 15 brokerages raised their price targets on Intel’s stock, with J.P.Morgan making the most aggressive move by boosting its target by $12 to $80, well above the median price target of $65.
Revenue at Intel’s data center business jumped 19% and sales to cloud computing providers surged 48% year-over-year in the fourth quarter.
(Interactive graphic on Intel's data center sales: tmsnrt.rs/2NVUJZY)
“We think Intel is benefiting from an improving macro economic climate versus company specific improvements at this time,” RBC Capital Markets analyst Mitch Steves said, adding that he expects strong results from data center rivals AMD (AMD.O) and Nvidia (NVDA.O).
Shares of AMD, which will report earnings next week, rose 1% to a record high. Nvidia shares were also up 1%. European chipmakers ASML Holding NV (ASML.AS) and STMicroelectricals NV (STM.N) rose almost 2%.
Intel's stock was up 8.6% at $68.75, a level it has not seen since the peak of the dotcom boom in 2000, propelling the broader Nasdaq .IXIC and the Philadelphia SE Semiconductor Index .SOX to record highs.
Other major chipmakers such as Taiwan Semiconductor Manufacturing Co Ltd (TSMC) (2330.TW) and Texas Instruments (TXN.O) have also given upbeat forecasts this month, cementing hopes of a rebound in the market that fell nearly 12% in 2019, according to research firm Gartner.
However, Intel has struggled with delays in its 10nm chip technology, losing its lead to rival TSMC in the race to supply to the “new data economy”, which includes 5G, autonomous vehicles and artificial intelligence.
AMD has partnered with TSMC to launch several new products based on the smaller 7nm design. Intel said on Thursday it would release nine 10nm products this year and launch its lead 7nm product next year.