This hasn’t been a banner year so far for many tech stocks. While there’s still a lot of enthusiasm for advancements in artificial intelligence (AI) and the buildout of AI infrastructure, the market has largely been taking a breather in the sector in 2026.
But that’s okay. There are still some great opportunities out there. In fact, KeyBanc analyst John Vinh recently highlighted two stocks — Intel (INTC) and Advanced Micro Devices (AMD) — as potential buys.
You may be aware of Nvidia (NVDA) as a major player in the AI infrastructure space, as the company’s graphics processing units (GPUs) have become critical in performing high-level functions that make AI possible. But the role of central processing units (CPUs) is equally important.
CPUs are critical for the basic functions in data centers and servers, handling tasks like data flow, database management, and many security and data integrity functions. Vinh noted that Intel is increasing its prices for server and client CPUs, and that its technology will also be used with Alphabet’s (GOOGL) tensor processing units — an opportunity that could be worth up to $5 billion on its own. AMD is also raising its CPU prices, and the company’s volume sales to Taiwan Semiconductor (TSM) in chip-on-a-wafer substrate is expected to increase from 70,000 interposers in 2025 to 80,000 this year, then jump by 70% in 2027.
With that said, let’s take a look at the opportunities found in both of these companies.
Intel is a major producer of semiconductors and microprocessors, supplying hardware for the Internet of Things (IoT), data centers, and AI functions. Based in Santa Clara, California, the company has a market capitalization of $311 billion.
INTC stock is up an extraordinary 227% over the last 52 weeks, far outpacing the S&P 500 ($SPX) (up 28%) and the Nasdaq 100 Technology Index ($NDXT) (up 41%). Additionally, while the tech sector has been relatively flat in 2026, Intel stock is showing gains of 75%.
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But with that run-up comes a huge change in the company’s valuation. INTC stock currently has a forward price-to-earnings (P/E) ratio of about 130 times — a number that has skyrocketed in the last several weeks. A year ago, the P/E was around 60 times.
Earnings for the fourth quarter included revenue of $13.7 billion, down 4% from a year ago, and full-year revenue of $52.9 billion, which was flat year-over-year (YOY). The company posted an EPS loss of $0.12 in the quarter and a loss of $0.06 for the full year.
“Our conviction in the essential role of CPUs in the AI era continues to grow,” said CEO Lip-Bu Tan. “We delivered a solid finish to the year and made progress on our journey to build a new Intel.” Intel expects Q1 revenue to be between $11.7 billion and $12.7 billion.
Analysts are taking a wait-and-see approach with INTC stock, offering a consensus rating of “Hold.” Out of 44 analysts with coverage, five analysts have a “Strong Buy” rating, one has a “Moderate Buy,” 33 have a “Hold” rating, one analyst has a “Moderate Sell,” and four have a “Strong Sell” rating. Analysts have a mean price target of $47.19 on INTC stock, representing potential downside of 27% from here.
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Advanced Micro Devices is one of the biggest chip companies in the space, manufacturing GPUs, CPUs and other high-performance processor products. The company, which is also based in Santa Clara, California, has a market capitalization of $399 billion.
Shares of AMD are up 163% in the last 12 months, but the company hasn’t had the same kind of gains in 2026 as Intel. AMD stock is up only 15% so far this year.
The valuation of AMD stock also couldn’t be any different from Intel, which trades at a premium right now. Shares of AMD trade at a forward P/E of 41.3 times, far below the mean and indicating that the stock is deeply discounted from its recent past.
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Revenue for the fourth quarter was $10.3 billion, up 34% YOY, while full-year revenue was $34.63 billion, also up 34% YOY. Diluted EPS came in at $0.92 for the quarter, an increase of 217% YOY. “We are entering 2026 with strong momentum across our business,” said CEO Lisa Su.
The company expects Q1 revenue to be about $9.8 billion, including about $100 million of chip sales to China. That represents 32% growth from a year ago.
Analysts are much more bullish on AMD stock than Intel, with 45 analysts having a consensus “Strong Buy” rating for shares. The mean price target of $287.39 represents potential upside of 16% from here.
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On the date of publication, Patrick Sanders had a position in: NVDA. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
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