5 Reasons Intel's CEO Just Made This Stock Worth Buying

Intel (NASDAQ: INTC) stock has climbed nearly 300% over the past year, which is not what anyone expected from a company that spent 2024 looking like it might have to sell itself for parts.

CEO Lip-Bu Tan took the job in March 2025 and has said the turnaround needs at least five years. What follows are five reasons why the case for owning the stock has changed, as well as why it could still go wrong.

Image source: Intel Corporation.

1. Tan put $10 million of his own money in

On Aug. 11, Tan bought 105,263 shares at $95 apiece, spending almost exactly $10 million and raising his personal stake by 8.7% to roughly 1.3 million shares. He did so around the same time the company sold new stock at that price and raised massive amounts of capital, per TheStreet. Executives get shares handed to them as pay all the time. Writing a check at the same price that outside investors are paying is a different act, one that insiders rarely perform when they expect a rough year ahead.

2. Intel raised $20 billion when it could have raised $15 billion

As mentioned earlier, Intel raised large amounts of capital. In early to mid-August, the company announced a $15 billion stock sale and priced it the next morning at $20 billion, selling 210.5 million shares at $95 for about $19.7 billion in net proceeds. Underwriters then exercised their option to purchase an additional 31.6 million shares in full.

Selling stock dilutes existing owners, meaning each share now represents a slightly smaller slice of the company. Analysts at Bank of America and UBS both trimmed their price targets by roughly 4% to 5% due to dilution, while calling the raise a net positive.

I see Tan's decision to raise the money now as a sign that Intel took advantage of investors' willingness to fund its turnaround. Building chip factories is expensive, and waiting for the perfect time to raise capital could leave Intel trying to fund the same projects when investors are far less willing to provide the money.

3. Intel is designing around the memory shortage instead of into it

At Computex in June, Tan detailed Crescent Island, a data center chip designed to answer AI queries rather than train models. According to TheStreet, Crescent Island deliberately skips the premium stacked memory that everyone is fighting over and uses the cheaper commodity kind found in phones and laptops, in an air-cooled card that fits ordinary servers.

Intel is giving up memory bandwidth, which limits the chip's training performance, in exchange for more memory capacity and reduced reliance on other companies, according to TheStreet. That could matter if customers care more about availability and capacity than peak performance.

I like Intel and Tan's approach here because it focuses on solving internal capacity and availability problems rather than forcing them to spend more to get the performance they need.

4. The manufacturing evidence is starting to arrive

Intel and equipment maker ASML Holding recently said that more than 1 million test wafers have already gone through Intel's newest chipmaking machines, which is a simple way of saying those tools are no longer stuck in the lab. They are running real silicon over and over, and each pass gives engineers another chance to spot problems and tune the process.

Company leadership also says the error rate on Intel's upcoming 14A process is coming down faster than the company expected, which, in plain English, means more of the chips coming off the line are usable rather than scrap.

5. Washington and Nvidia are both on the shareholder list

And lastly, the federal government owns just under 10% of Intel after buying 433.3 million shares at $20.47 in 2025. This shows that Washington has tied a chunk of its industrial policy to Intel and has a strong incentive to see this turnaround succeed rather than watch the company slide backward. Around the same time, Nvidia built a roughly $30 billion equity position in Intel. I think these investments would have happened with or without Tan, but they are still massive nods to Intel's future.

Bank of America is an advertising partner of Motley Fool Money. Micah Zimmerman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends ASML, Intel, and Nvidia. The Motley Fool has a disclosure policy.