Why You Should Short The Intel Fab Play

Apr. 07, 2021 12:26 PM ETIntel Corporation (INTC)AMD184 Comments

Summary

  • Intel has risen on news that it will spend $20B on establishing chip manufacturing factories in Arizona, but this news is more bearish than bullish to me.
  • Investing in Intel now, at a relative high and while earnings are expected to fall, just because of the potential fab catalyst is nonsensical once you consider the full situation.
  • I reiterate my bearish position on Intel and recommend a diagonal put play.
  • Looking for more investing ideas like this one? Get them exclusively at Exposing Earnings. Learn More »

The electronics engineer assembles the chip
Photo by Avalon_Studio/iStock via Getty Images

I previously stated that Intel (NASDAQ:INTC) has no answer to Advanced Micro Devices (AMD), a statement that ruffled some feathers.

I’ve more-or-less officially been an Intel bear for a few months now, and I

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This article was written by

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Damon Verial is a statistical analyst who uses his skills to research stocks, options, and investment strategies. In addition, Damon is the writer of Copy My Trades, a trade-alert, subscription-based newsletter, available at his personal website. He is also the writer of Exposing Earnings, an in-depth earnings prediction service here on Seeking Alpha.

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Damon makes his living as a gap trader, an earnings trader, and an interday trader. In his free time, he writes for Seeking Alpha, where he focuses on seasonal investing, market timing, and earnings analyses.

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Damon has written several successful stock analysis algorithms, including algorithms that can predict gap closure, intraday patterns, and news overreactions. They will soon be publically available for subscribers.

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Damon’s undergraduate education was in statistics and mathematics at the University of Washington; his graduate education was in psychology at National Taiwan University. He currently lives in Fukuoka, Japan.


Disclosure: I/we have no positions in any stocks mentioned, but may initiate a short position in INTC over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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