Should You Buy Intel Stock

Should You Buy Intel Stock by Andrew Blumer last updated on October 04, 2026

Should You Buy Intel Stock After The Bull Rally?

Intel's stock price has increased four times over the last 12 months. Another thing that has increased during the period is Intel's quarterly operating income from its data center business.

The bullish rally in Intel has pushed its market cap above $500 billion. However, what's strange is that it is a firm that is making a loss of $11 billion according to reports. This was revealed in its report of the recent quarter.

So, should you buy Intel stock, or was the recent bullish rally overdone? Let's look closely at what's going on with Intel.

Data Center Segment Is Driving Strong Growth

The driving force behind the rally was Intel's data center business. The revenue during Q2 was $16.1 billion with a 25% y/y increase. According to Intel's CEO, this is the strongest growth seen by the company in more than 15 years.

The most growth came from the AI and data center segments. Around a year ago, the operating income during the quarter was $633 million. However, the results from Q1 2026 showed an operating income of $1.5 billion. In Q2, the income increased to $2.5 billion.

However, it is also a reality that Intel's foundry business isn't doing that well. Its losses have gone down, but it is still in a loss nonetheless.

The revenue of Intel's foundry during Q2 went up by 31% y/y and reached $5.8 billion. However, the total loss was still around $2.1 billion. This was an improvement, as the earlier loss was near $3.2 billion.

However, most of the foundry's revenue didn't come from any external customer. Intel was buying from itself and accounted for the most revenue. External sales only accounted for less than 2% of the company's total revenue.

For now, it seems Intel has not found any high-volume customer for its Intel 14A. It is the next-generation manufacturing process for making high-performance semiconductors.

Intel's earnings and its stock price suggest that it is trading at a forward P/E of 47. That's quite high when we consider the fact that TSMC is trading at a forward P/E of around 20.

The bottom line is that things have improved, but Intel stock is overvalued. You can easily find better options in the US and international markets.