Intel (INTC) Stock: Declines Almost 3% Despite BofA Upgrade

TLDRs;

Intel shares gained modestly in after-hours trading despite a nearly 3% intraday drop.
Bank of America upgraded Intel to Overweight, highlighting balance sheet improvements and positive cash flow.
Intel underperformed semiconductor peers such as Nvidia and Broadcom during Monday’s session.
Holiday-thinned trading and upcoming economic releases may increase Intel stock volatility on Tuesday.

Intel Corporation (NASDAQ: INTC) ended Monday’s trading session down almost 3%, even as the broader market posted gains. The stock closed at $36.37, marking a 1.22% drop in regular hours, before inching up slightly to $36.45 in after-hours trading, reflecting a modest 0.22% gain.

While the small after-hours recovery provided some relief, the decline in regular trading underscored stock-specific weakness rather than a broad-market pullback.

Intel Corporation, INTC

Trading volumes were lighter than usual, with around 48 million shares changing hands, far below recent averages. Analysts note that lower liquidity during the holiday-shortened week can exaggerate daily swings, and Monday’s action was no exception.

Intel’s stock remains roughly 17% below its early-December highs, highlighting the ongoing struggle to maintain momentum despite positive developments.

Bank of America upgrade supports sentiment

A key catalyst in stabilizing Intel shares after Monday’s drop was Bank of America’s upgrade from “Marketweight” to “Overweight.” BofA analyst Tom Curcuruto highlighted improvements in Intel’s liquidity, stronger credit metrics, and a return to positive free cash flow for the first time since 2023.

The note also emphasized Intel’s relatively lower exposure to the AI demand cycle, suggesting the company may be better insulated if AI infrastructure spending slows or market concerns intensify.

BofA raised its FY25 and FY26 EBITDA forecasts by 20% and 18%, respectively, signaling confidence in Intel’s ongoing turnaround and operational improvements.

Despite the bullish rating, analysts caution that upgrades alone may not drive immediate gains, especially in thin markets where macroeconomic data and broader sector trends often dictate daily performance.

Intel lags semiconductor peers

Even as major indices rose, S&P 500 up 0.64%, Dow Jones up 0.47%, and Nasdaq up 0.5%, Intel’s performance lagged behind key semiconductor competitors. Nvidia and Broadcom both posted gains during Monday’s session, illustrating a divergence within the sector. Experts attribute Intel’s underperformance to profit-taking after recent gains and cautious positioning ahead of potential market-moving macroeconomic data later in the week.

Additionally, investor attention continues to focus on Nvidia’s $5 billion investment in Intel, which recently cleared U.S. antitrust scrutiny. Market participants see the deal as an indicator of Intel’s ability to attract external capital and strengthen its manufacturing footprint, though its immediate effect on trading remains limited amid thin holiday volume.

Macro data and holiday liquidity key for Tuesday

Looking ahead, Intel faces potential volatility on Tuesday as several economic reports could influence investor sentiment. Scheduled releases include the third GDP revision, Consumer Confidence index, New Residential Sales, and the Richmond Fed manufacturing survey.

Semiconductor stocks like Intel are particularly sensitive to shifts in Treasury yields, which can affect long-duration equity valuations.

The holiday-thinned trading environment means that even modest news can trigger exaggerated stock movements. Traders are advised to monitor intraday technical levels, including Monday’s low of $36.29 and high of $37.90, while keeping a close eye on sector-wide sentiment influenced by Nvidia and broader AI infrastructure trends.

Bottom line

Despite a Bank of America upgrade that highlighted balance sheet improvements, operational progress, and relative value appeal, Intel’s shares dropped almost 3% on Monday, reflecting stock-specific pressure and cautious positioning.

After-hours trading provided a slight lift, but holiday-thinned markets and upcoming macroeconomic releases could lead to sharp swings as investors navigate a delicate end-of-year trading week.

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