This Could Be Huge for Intel Stock
It’s a tough feat to find a stock that offers both value and growth. But what if I told you that Intel Corporation (NASDAQ:INTC) stock offers both?
With a solid dividend yield of 3.51%, this dividend aristocrat has historically been recognized for its computing platforms. But Intel has recently moved beyond its core business of computer microprocessors to new industries that offer a much higher growth potential.
One of its latest ventures spells huge upside for INTC stock, as this technology hits the mainstream.
At the Consumer Electronics Show (CES) at the beginning of this year, one technology particularly stood out. Dozens of big and small companies showcased their products running this technology. In fact, the industry for this technology is expected to hit $150 billion in revenue by 2020.
If you haven’t guessed already, I’m talking about augmented reality (AR). Oftentimes, it is coupled with virtual reality (VR), but is in fact a completely different concept. Companies like Alphabet, Microsoft, HTC, Facebook, Sony, and numerous others are betting on virtual reality. But Intel has bigger plans.
Intel doesn’t just want you to put on some headgear to watch virtual computer-generated images—which is essentially what virtual reality is. Instead, Intel wants you to be able to interact with these virtual images in real space.
The giant chipmaker is working on its own augmented reality headset using its “RealSense” technology. Intel’s next-generation microprocessors and image-processing chips will go into making the headset. (Source: “Intel Working on Augmented-Reality Headset,” The Wall Street Journal, March 2, 2016.)
Pay attention to why Intel wants to enter this industry. Augmented reality is the future of technology. Doctors will be able to operate, teachers will be able to teach, engineers will be able to design, architects will be able to model, and gamers will be able to play in augmented reality. That is only a conservative list of possibilities.
Intel wants to move in early and perfect this technology, so that all future augmented reality wearables will run on Intel’s processors and chips. Intel will manage to become a leader in a booming industry way before the competition will find its way in.
In fact, this is not the only high-growth industry where Intel is betting. The company is also investing in the drone industry, which officially took off this year after the U.S. Federal Aviation Administration opened registrations for commercial flights. (Source: “AT&T and Intel test drones’ capabilities on LTE beyond line of sight and at higher altitudes,” Venture Beat, February 22, 2016.)
The Bottom Line on INTC Stock
Intel has consistently stepped up its investment in research and development (R&D) over the years and is continuing to commit billions to growth. At the same time, the stock delivers value through robust dividends and buybacks.
In a nutshell, INTC stock is one promising value-cum-growth play that’s worth a closer look for the long haul.