Intel stockholders have a lot to digest this week. Two major developments just dropped, and both could have significant implications—not just over the next few months, but for years to come. The first is the U.S. government's announcement of new tariffs on foreign trading partners, which directly impacts global tech supply chains. The second is a reported breakthrough agreement between Intel and Taiwan Semiconductor Manufacturing Company, or TSMC.
Together, these events could reshape Intel’s role in the semiconductor industry, impact its competitive positioning, and meaningfully alter its long-term investment profile. In this video, we’re going to unpack both of these stories, break down what they mean for Intel stockholders, and ultimately answer the question: Is Intel stock a buy right now?
Let’s start with the big news: Intel and TSMC
According to a report from The Information, Intel and Taiwan Semiconductor have reportedly reached a tentative agreement to form a joint venture. The venture would involve TSMC and other U.S.-based semiconductor companies working together to operate Intel’s chip fabrication plants. Under the deal, TSMC would take a 20% ownership stake in the joint entity, while Intel and its American partners would retain majority control.
Now, why is this such a big deal? The short answer: Intel needs help. Over the past decade, Intel has gone from being a leader in semiconductor manufacturing to a company that's been losing ground, both in terms of market share and technological capabilities. Intel’s in-house manufacturing has faced delays, yield issues, and a general failure to keep up with cutting-edge nodes. As a result, competitors like AMD, Nvidia, and Apple have turned to more reliable third-party foundries—most notably, Taiwan Semiconductor.
Meanwhile, TSMC has cemented itself as the undisputed leader in chip manufacturing. Their ability to deliver consistent, high-quality chip production—on time and at scale—has made them the go-to manufacturer for companies across the globe. AMD, Qualcomm, Nvidia, and even Apple rely heavily on TSMC to fabricate their most advanced chips.
The timing of the announcement is particularly notable, coming just as Intel is scaling up its next-generation 18A process node—a pivotal milestone in its plan to recapture a leading position in semiconductor manufacturing. This has led to a more skeptical view: if Intel was confident in its own production capabilities, why the sudden need for external support? To some, the partnership hints at deeper issues with the 18A rollout—suggesting that Intel may be struggling to hit its targets and has turned to TSMC as a stopgap to stabilize operations.
Adding to the uncertainty is the silence from several key industry players rumored to be part of Intel’s broader foundry initiative, including Broadcom, AMD, and Nvidia. None have publicly addressed the development, leaving investors to question whether the partnership signals a broader industry shift—or if Intel is acting alone out of necessity rather than strength.
As the news continues to unfold, industry analysts are keeping a close eye on how this alliance will take shape. On one hand, tapping into TSMC’s manufacturing expertise could significantly accelerate Intel’s foundry ambitions and help streamline its processes. On the other hand, the early market response indicates investor concern that the partnership may reflect operational weaknesses rather than a proactive strategic maneuver.
This deal, if finalized, could give Intel something it’s been desperately lacking: operational know-how. According to the report, TSMC would not only invest capital into the venture but also share its process expertise, including training Intel’s personnel and advising on chip fabrication best practices.
This is a huge win for Intel.
Let’s not forget—Intel already has a lot of key ingredients for success. It owns and operates massive U.S.-based fabs, has strong customer relationships built over decades, and has the capital resources to invest heavily in R&D and capacity. What it’s been missing is execution. And execution is exactly what TSMC brings to the table.
From TSMC’s perspective, the benefits are clear as well. Amid growing geopolitical uncertainty, especially around Taiwan’s relationship with China, the company is under pressure to diversify its manufacturing footprint and strengthen its presence in the United States. By taking a stake in Intel’s domestic operations, TSMC gains access to U.S. manufacturing, complies with growing regulatory pressures, and hedges against potential disruptions in Asia.
Tariffs: Another Tailwind for Intel?
Now let’s shift gears and talk about the other major news: the U.S. recently announced a new round of tariffs on imports from key trading partners. While tariffs are often seen as bad news for global supply chains, they could actually work in Intel’s favor.
Here’s why: Intel does most of its chip manufacturing inside the United States. That gives it a strategic edge. With new tariffs making foreign-manufactured chips more expensive, U.S.-based companies like Intel are suddenly a lot more competitive. Add to that the fact that Intel has both design and manufacturing in-house, and you start to see why this could be a tailwind for the company.
My discounted cash flow (DCF) valuation model currently puts Intel’s intrinsic value at $32 per share, versus a market price hovering around $22. That suggests a meaningful margin of safety for long-term investors—especially now, with Intel becoming less risky thanks to these latest developments.
Tariffs are also likely part of the reason Intel was able to strike a favorable deal with TSMC. With trade barriers rising, companies like TSMC don’t want to be shut out of the U.S. market. Their customers are heavily concentrated in the U.S., and access to that market is critical. Entering into a joint venture with Intel ensures they stay in the game—even if trade tensions escalate.
What About Leadership?
Intel has also taken important steps on the leadership front. The company recently appointed a new CEO—formerly from Cadence Design Systems—who brings deep technical expertise and a clear vision for how Intel can get back on track. This was a key overhang for investors. Now that it’s resolved, Intel’s turnaround narrative becomes even more credible.
Risks Still Remain
Now, I want to be clear: Intel is not without risk. The broader semiconductor market could slow down, especially if tariffs push up consumer prices. Higher costs often lead to reduced demand. That can mean lower revenues for chipmakers, not just in consumer electronics but across automotive, industrial, and enterprise sectors. A slowdown in demand could trigger layoffs, weaken consumer spending, and feed into a broader economic slowdown.
So while Intel may gain market share within the chip sector, it’s possible that the overall size of the market could shrink in the short to medium term. That’s something investors need to be prepared for.
Valuation Still Looks Attractive
Even with those risks, the valuation is compelling. Intel currently trades at a forward P/E of 19.6, which is the lowest it's been all year. For a company of Intel’s size, history, and potential strategic advantages, that’s not expensive. And if the TSMC partnership proves successful, Intel could begin regaining some of the market leadership it’s lost over the years.
Final Thoughts: Is Intel a Buy?
So, is Intel a buy?
In my view—yes. My valuation models point to Intel being undervalued. The company now has multiple catalysts working in its favor: a fresh and capable leadership team, new tailwinds from protectionist trade policy, and potentially transformative support from the best manufacturing partner in the business.
There’s still risk—this isn’t a guaranteed turnaround story. But when you weigh the upside potential against the current valuation, I believe the risk-reward profile is attractive for long-term investors.
Disclaimer: I want to make it clear that I am not a financial advisor, and nothing I say is intended to be a recommendation to buy or sell any financial instrument. Additionally, it's important to remember that there are no guarantees or certainties in trading or investing, and you should never invest money that you can't afford to lose.
@Daily_Discussion @TigerPM @TigerObserver @Tiger_comments @TigerClub
Comments