It’s fine to take risks if your position size is small. With that principle in mind, I’m recommending buying only $100 worth of Intel (NASDAQ:INTC) stock before the company’s upcoming earnings report. Otherwise, you might miss out on quick gains after a positive earnings surprise.
Another reason to take a chance on Intel now is that the company is collaborating with a competing tech-hardware firm. There’s an artificial intelligence (AI) angle to this development, so don’t miss the details as there may be a prime opportunity here.
Intel Partners With a Popular Rival
In case you didn’t get the memo, everybody and his uncle likes Nvidia (NASDAQ:NVDA) in 2023. That’s because investors view NVDA stock as a perfect pick-and-shovel play as Nvidia supplies hardware to power generative AI applications.
Therefore, it’s definitely good news for INTC stock investors that Intel is collaborating with Nvidia, and there’s an AI angle here. It’s not on Intel’s press releases page (oddly enough), but according to InsideHPC, Intel announced at a conference that it’s partnering with Nvidia to “enable a more unified, easy-to-deploy attestation solution for ‘Confidential AI’” using Intel CPUs and Nvidia GPUs.
This isn’t the first time that Intel has announced AI-friendly projects; see here and here for recent examples if you’re so inclined. The collaboration with Nvidia is different, however.
Together, the two tech titans plan to advance “confidentiality-preserving” (i.e., secure/trustless) AI solutions. Perhaps, since the market is enamored with Nvidia now, the partnership can help Intel regain favor among the investing community.
INTC Stock Investors: Mark This Day on Your Calendar
If you’re trying to decide whether to buy INTC stock or not, I wouldn’t wait too long. There’s an upcoming event that could be make-or-break, and I’m expecting “make” instead of “break.”
Here’s the lowdown. Intel plans to release its second-quarter 2023 earnings results on July 27 after the stock market closes. Could this event spark the U.S. chipmaking sector’s biggest comeback story of the year? It’s entirely possible, especially since Intel’s first-quarter results reminded some financial traders of the company’s market-share loss to rivals like Advanced Micro Devices (NASDAQ:AMD).
There will also be a conference call on July 27. That will provide Intel’s management an opportunity to tout the company’s AI-friendly initiatives. After all, the public certainly wants to know how Intel intends to serve the red-hot generative AI market.
Additionally, Intel will now have a chance to beat Wall Street’s expectations. Intel disappointed some shareholders by posting an unprofitable quarter in Q1. Consequently, analysts are fully prepared for Intel to report another unprofitable quarter.
Moreover, Intel disclosed a 36% year-over-year revenue drop in the first quarter. Around that same time, Intel drastically slashed its dividend. These factors have contributed to muted expectations – and that’s a prime setup for a positive surprise. If Intel can at least provide not-as-bad-as-anticipated quarterly results, a buying spree could ensue with INTC stock.
Go Ahead and Bet $100 on INTC Stock
Of course, there’s no guarantee that Intel will post expectation-beating results. Hence, it’s wise for Intel’s shareholders to maintain a very moderate position size.
On the other hand, it’s exciting to see Intel partnering on an AI project with a market darling like Nvidia. With that in mind, feel free to risk $100 on INTC stock since, if luck is on your side, a breakout may be right around the corner.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.