15 Best Hardware Stocks According to Hedge Funds

12. Intel Corporation (NASDAQ:INTC)

Number of Hedge Fund Shareholders In Q1 2024: 77

Intel Corporation (NASDAQ:INTC) is a household name and the largest chip manufacturer in the world. While the firm has struggled with keeping the lead in manufacturing technologies as of late, it is emerging as a competitor to NVIDIA in AI hardware. Intel’s Gaudi accelerator is designed to compete with NVIDIA’s latest AI products, and May 2024 was a good month for the stock as it saw Wolfe Research upgrade Intel Corporation (NASDAQ:INTC)’s share rating to Peer Perform from Underperform. At the heart of the upgrade was the firm’s belief that Intel Corporation (NASDAQ:INTC)’s margins should improve in the future now that it has absorbed the cost and geared up to move more production in house.

For their Q1 2024 investment stakes, 77 funds out of the 919 part of Insider Monkey’s database were Intel Corporation (NASDAQ:INTC)’s stakeholders. Peter Rathjens, Bruce Clarke, and John Campbell’s Arrowstreet Capital owned the most valuable stake that was worth $905 million.

When compared to other AI hardware stocks, Intel Corporation (NASDAQ:INTC)’s forward price to earnings ratio of 28 means that investors understand that Intel’s earnings are temporarily depressed as the company invests large amounts of capital into its business and the company will eventually post large EPS growth numbers. Ariel Investments mentioned the firm in its Q4 2023 investor letter, citing optimism in the stock and sharing:

New holding, Intel Corporation, one of the world’s largest semiconductor chip manufacturers by revenue, outperformed in the quarter. Intel is benefitting from the near-term rebound in semiconductor demand driven by the cyclical recovery of personal computers (PCs) and central processing units (CPUs). Shares also traded higher following the company’s Artificial Intelligence (AI) Everywhere launch event. Intel introduced its capabilities across cloud, edge and client hardware and showcased it can benefit from an enterprise upgrade cycle as both cloud-based and traditional enterprises look to incorporate AI features into core technology platforms. In our view, the market is also overlooking the progress Intel has made towards regaining its manufacturing technology advantage and believe the foundry business will continue to experience strong momentum as it grows its customer base and revenue.