Business Corpus: Intel Stock Tumbles On Sell Rating, AMD Stock Gets UpgradeInvestment bank Goldman Sachs on Friday downgraded chip giant Intel to sell from neutral, while upgrading rival Advanced Micro Devices to neutral from sell. Intel stock dropped on the news and AMD stock rose modestly. The post Intel Stock Tumbles On Sell Rating, AMD Stock Gets Upgrade appeared first on Investor's Business Daily.

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Investment bank Goldman Sachs on Friday downgraded chip giant Intel (INTC) to sell from neutral, while upgrading rival Advanced Micro Devices (AMD) to neutral from sell. Intel stock dropped on the news and AMD stock rose modestly.

Goldman Sachs analyst Toshiya Hari lowered his rating on Intel on concerns about rising competition and declining profit margins. He cut his 12-month price target on Intel stock to 44 from 49. Hari raised his price target on AMD stock to 21 from 13.25.

Intel stock fell 2.5%, near 48.90, in morning trading on the stock market today. It cut below its 200-day moving average, a key support level. It has been trading below its 50-day moving average since late June.

AMD stock rose a fraction, near 19.10. It is trading just below a nearly 12-year high of 20.18, reached on July 30. The stock broke out of a 44-week consolidation period on June 7 at a buy point of 16.75.

Facing Competitive Threats

Intel is facing increasing competition from AMD and Taiwan Semiconductor Manufacturing (TSM), Hari said in a report.

Intel's struggles with its 10-nanometer chip manufacturing process are likely to hurt its profit margins and competitive positioning, he said.

The Santa Clara, Calif.-based company has pushed back production of 10-nanometer chips multiple times because of yield issues. It now expects to produce 10-nanometer PC chips in the second half of 2019, followed by data-center processors. Meanwhile, AMD is already sampling 7-nanometer server processors, Hari said.

Taiwan Semi also is beating Intel to market with 10-nanometer and 7-nanometer chips, he said.

AMD is likely to gain market share from Intel in central processing units for PCs and servers, Hari said.

"The delay in Intel's new products will allow AMD to gain share in not only client (i.e. desktop PC, notebook PC) CPUs, but also in the lucrative server CPU market," Hari said.

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