Intel (NASDAQ:INTC) May Be in Danger of Being Removed from the Dow Jones

The calamitous price drop continues for Intel (INTC), as Reuters commentators are starting to question if the chip maker is in danger of being removed from the Dow Jones Industrial Average (DIA). That was bad news enough for investors, who sent shares down over 8% in Tuesday afternoon’s trading.

Intel was actually one of the first big tech firms, alongside Microsoft (MSFT), that got in on the Dow back in the late nineties. It was clear that the landscape was shifting, and tech companies needed to be represented in this key measure. Thus, Microsoft and Intel were selected to be representatives of the tech sector.

However, times have changed. There are a lot more tech companies out there, and a growing body of investors and analysts are starting to think that Intel’s days of representing tech in the Dow are coming to a close. With a roughly 60% drop over the last year, it is now the worst performer on the index, reports noted. In addition, if Intel is pulled from the Dow, that will be another punch in its storied reputation that will hurt Intel even further.

The Fire Sale Continues

Intel’s plans to perk up its bottom line and draw investors are continuing apace, as reports suggest that Intel could be looking to sell off Altera. Intel CEO Pat Gelsinger took a presentation to the Intel board of directors, noted a Fast Company report, to start divesting “unnecessary businesses” and change its spending plans accordingly.

The plans to sell off the foundry unit, however, were not part of this proposal. Rather, Intel is likely to either slow or halt the construction of a factory in Germany, a project slated to cost $32 billion. That project was already delayed once, and the delay may continue or even amplify from there.

Is Intel a Buy, Sell, or Hold?

Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 26 Holds, and five Sells assigned in the past three months, as indicated by the graphic below. After a 43.88% loss in its share price over the past year, the average INTC price target of $27.32 per share implies 35.35% upside potential.

See more INTC analyst ratings

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