13% Intel Drop Is a Cautionary Tale to Traders

Core Viewpoint - Despite exceeding Wall Street expectations for earnings per share and revenue, Intel's stock dropped by as much as 13% after the Q4/full-year earnings report due to weaker guidance [1][3]. Financial Performance - Intel reported that it exceeded Q4 expectations across revenue, gross margin, and EPS while navigating industry-wide supply shortages [3]. - The company anticipates that its available supply will be at its lowest level in Q1 2026 before improving in Q2 and beyond [2][3]. Market Reaction - The stock's significant drop post-earnings report serves as a reminder for traders to pay attention to market reactions, which may not align with positive earnings results [1]. - The stock has increased over 100% in the last 12 months, prompting concerns among traders about potential selling opportunities [2]. Industry Context - Demand fundamentals across Intel's core markets remain healthy, bolstered by the rapid adoption of AI, which reinforces the importance of the x86 ecosystem [3][5]. - The long-term trend of AI is expected to provide ample industry tailwinds for semiconductor companies like Intel [4]. Investment Opportunities - The significant stock drop may present a buying opportunity for traders, especially given Intel's long history and potential to weather market corrections [4]. - The Direxion Daily INTC Bull 2X ETF (LINT) offers traders a way to gain 2X daily exposure to Intel's stock, appealing to those who believe in a recovery from the recent pullback [6][7].