Intel Corp. (NASDAQ:INTC) stock has been left for dead more than once in recent years. Not anymore.

Shares of Intel are up 86% year-to-date, and a fresh note from BNP Paribas explains why the rally has legs — even if the bank thinks the stock has gotten a little ahead of itself. 

BNP upgraded Intel from Underperform to Neutral on Monday, lifting its price target from $34 to $60, while flagging that at $68.50, shares still imply about 12% downside to that target.

Agentic AI Catalyst

So what changed? Two words: agentic AI.

The rise of AI agents is adding to an already enormous appetite for server CPU chips. Hyperscalers are scrambling to lock up supply, and Intel finds itself in a rare position of pricing power. 

Chip prices are rising, fabs are running near full capacity, and that combination is doing something Intel hasn’t been able to say for a while: expanding margins. 

BNP forecasts EBITA to swing from a loss of $2.2 billion in FY25 to a positive $736 million in FY26, with the trajectory accelerating sharply to $4.6 billion by FY27 as utilization stays high and pricing holds.

Intel also just bought back Apollo Global‘s 49% stake in its Ireland manufacturing facility — a signal that management is bullish enough on the demand outlook to consolidate ownership of its own production capacity.

BNP models Intel’s datacenter revenues growing 14% year-over-year in fiscal 2026, with another 8% increase in 2027.

The Foundry

The other piece of the puzzle is Intel’s next-generation 14A manufacturing process — its most advanced chip-making node yet. 

Potential foundry customers are actively reviewing early 14A technical data, and Intel’s CEO has publicly said progress is strong.

If the company can convert that interest into actual design wins — which BNP thinks could happen in late 2026 or early 2027 — it would mark a major validation of Intel’s foundry ambitions and another potential margin expansion driver.

However, not everything is clean. The firm points to PC revenues facing headwinds from a memory supply crunch dragging industry volumes down roughly 11% this year, and server market share continues to slowly erode toward AMD and ARM.

But for now, BNP says the AI tailwind is strong enough to paper over the cracks — and Intel's margin story is finally moving in the right direction.

INTC Price Action: Intel stock was up 2.24% at $67.17 at the time of publication Tuesday. The stock is approaching its 52-week high of $70.32, according to Benzinga Pro data.

Photo: PJ McDonnell / Shutterstock