While Intel has had a great run over the past decade, I believe we’ve reached an inflection point. They’ve already had to start laying off employees: investorplace.com/2020/01/intel-layoffs-2020-things-to-know/
With AMD breathing down their back, Intel is lowering prices on their server chips lowering profit margins which won’t be coming back anytime soon: www.anandtech.com/show/15405/intel-cuts-xeon-prices
Intel is constantly talking about how they’re going to be shipping 7nm in 2021 when they have failed to get their 10nm process working for almost 4 years now past its original expected release date. It’s clear Intel’s process has stagnated, and their choice to stick with manufacturing their own CPUs has now turned from advantage to disadvantage as it’s competitors are able to focus on design while leaving the process improvements to TSMC: www.pcworld.com/article/3394398/intel-commits-to-shipping-7nm-chips-by-2021-an-aggressive-change-of-pace.html
I’ll be honest in saying that I’m probably somewhat biased here in that I don’t trust business CEOs to know how to run a tech company properly. As an engineer, I know how important it is that you actually understand your products and the engineering that goes into CPU design, and so I prefer when the CEO actually has that capability.
Intel hasn’t been run by an engineer for quite some time at this point. Just look at Intel’s current CEO Bob Swan. He is literally the definition of the “MBA business type executive”. We compare that to companies like AMD and Nvidia, which are both headed by strong technically minded engineers and the differences in management are like night and day.
All of these are reasons why I believe Intel has largely peaked as a company, and my thesis for why Intel is a good stock to go short on right now
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.