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Intel Headquarters in Santa Clara, California.
Justin Sullivan / Getty Images
Intel
the shares caught a bid on Tuesday after news broke that activist investor Daniel Loeb of Third Point had acquired a significant stake in the chip maker and was pushing him to explore strategic alternatives.
Shares rose 5.7% in the afternoon trading after Reuters reported that the Loeb hedge fund held a nearly $ 1 billion stake in the $ 200 billion company.
Loeb, who recently pressed
Walt Disney
(DIS) to focus more on its streaming platform and permanently suspend its dividend, urges Intel (ticker: INTC) to hire an investment advisor to help the chip maker determine whether it should remain an integrated manufacturer of devices and whether it should give up some of its recent acquisitions.
The activist investor added that it is crucial for Intel to keep customers like Apple (AAPL),
Microsoft
(MSFT) and
Amazon.com
(AMZN), rather than allowing them to send their production abroad.
Intel has faced a lot of criticism in recent years because its market role has been ceded to rivals such as
Advanced Micro Devices (AMD),
Nvidia
(NVDA) and
Taiwan Semiconductor Manufacturing
(TSM). Intel shares are trading with gains about 10 times higher, making it look like beaten shares, such as
General Electric (GE),
rather than his colleagues, who trade with incomes up to 50 times.
In a cover story last month, Barron’s detailed how Intel does not deserve its low rating and that it has better days ahead.
In a statement Tuesday, Intel said it “welcomes the contribution of all investors to the increased value of shareholders” and looks forward to committing to Third Point.
Intel’s decline is a national security concern, Loeb wrote in a letter to Omar Ishrak, chairman of Intel’s board of directors.
“With no immediate changes to Intel, we fear that America’s access to cutting-edge semiconductor supply will erode, forcing the United States to rely more on an unstable geopolitically East Asia to power everything from PCs to data centers. , to critical infrastructure and much more, ”Loeb wrote.
Write to Carleton English at [email protected]