BofA raised its rating on Intel stock by two notches at once. What is the bank betting on?

Bank of America has dramatically changed its rating on shares of processor maker Intel: it has dropped its advice to sell them and now recommends buying them. According to the bank, Intel will be a beneficiary of the growing popularity of AI agents, increasing demand for central processing units (CPUs). In addition, Intel's shares are now less popular with investors than those of its competitors, which also creates potential for growth, BofA believes.

Bank of America raised its rating on Intel shares from Underperform ("below market"), which is equivalent to the advice to sell securities, immediately to Buy - recommendation to buy. The bank also raised the target from $96 to $135 - that's 26% higher than the closing price on Wednesday, June 10, Investor's Business Daily reports.

Bank of America analyst Vivek Arya explained in a June 11 note that the change in his stance on Intel stock is due to a shift in focus in AI infrastructure development from custom and graphics AI chips to CPUs, CNBC writes.

"Agent-based AI differs from traditional generative AI in that it moves away from a one-query-one-response scheme to a multi-stage system that can plan, reason, search for information, use tools and execute program code simultaneously," CNBC quoted Arya's note. - While specialized chips remain critical for inferencing (data output. - Oninvest), many process coordination and decision-making functions are latency-sensitive, run sequentially, and require intensive data exchange. Therefore, they are better suited for CPUs."

Arya predicts that CPU sales will reach $40 billion by 2030. By comparison, Intel's data center processor division generated $5.1 billion in revenue for the company in the first quarter of 2026.

Shares of Intel have risen 60% since the publication of reports on April 23, when the company for the first time showed signs of renewed revenue growth. That said, Intel's stock is still less popular among investors than shares of other major chip makers, CNBC notes. It also supports Arya's positive outlook on the company.

"As of May 2026, Intel is the second least popular semiconductor and AI infrastructure sector stock among investors in the S&P 500, behind Sandisk, despite having a market capitalization of about $540 billion and ranking fifth in the group," Arya wrote. - Intel shares are held by only 16% of funds tracked by Bank of America (up about 3 percentage points month-over-month), so the broader investor universe could be an additional driver of the stock's upside."

Intel shares were up 11.6% to $119.44 at the moment in trading on June 11.

According to MarketWatch, of the 52 analysts tracking the chipmaker's stock, 32 of them take a neutral stance and recommend holding the securities in the portfolio (Hold rating), 16 advise buying (Buy and Overweight), and four analysts recommend selling the stock (Underweight and Sell). The Wall Street consensus target price is $98.17, down 8.3% from the stock's closing price on June 10.

This article was AI-translated and verified by a human editor