Forget Intel. Its Own Executives Are Cashing Out and This Is the Chip Stock You Should Own Instead

Intel (NASDAQ:INTC | INTC Price Prediction) has roughly tripled this year on a turnaround narrative wrapped around AI inference workloads, a fresh Google partnership, and selection as the host CPU for NVIDIA‘s (NASDAQ:NVDA) DGX Rubin systems.

But here’s what you should actually be watching.

The Intel Rally Is a Crowded Trade Dressed Up as a Comeback

Intel is up 214.17% year to date and 438.71% over the past year, closing at $115.93 on May 14. That move is pricing in a foundry transformation the income statement has yet to deliver. Q1 results carried a GAAP net loss of $3.73 billion, an operating loss of $3.14 billion, and free cash flow of negative $3.87 billion. Intel Foundry has now bled billions of operating losses for multiple consecutive quarters, and management guided Q2 non-GAAP gross margin down to roughly 39.0% from 41.0%. Margins go the wrong way next quarter while the chart goes vertical.

Insiders are taking chips off the table. The Chief Legal Officer sold 40,256 shares at $99.526 on May 1, and the EVP running Foundry operations sold 13,649 shares at $93.60 the day prior. On r/stocks, the highest-engagement thread of the cycle was titled “Intel trading at a ~119x forward P/E and nobody is talking about this”. Retail sentiment scores have rolled over into the 28 to 35 bearish range over the past week. Add the U.S. government’s CHIPS Act equity stake and uncertainty around the Intel 14A node, and you have a politically dependent foundry priced like a clean growth story.

Taiwan Semiconductor Is the Foundry Actually Printing Money

Taiwan Semiconductor Manufacturing (NYSE:TSM) deserves the attention Intel is hogging. Three reasons.

1. Margins and scale Intel cannot touch. TSMC reported Q1 revenue of $35.9 billion, with gross margin of 66.2% and operating margin of 58.1%, both above guidance. Q2 revenue guidance of $39.0 billion to $40.2 billion and gross margin guidance of 65.5% to 67.5% imply margins are still expanding. Full-year 2026 revenue is guided to grow above 30% in dollar terms.

2. Real technology leadership shipping in volume today. Advanced nodes at 7nm and below account for 74% of wafer revenue, with 3nm alone contributing 25%. TSMC controls 72.3% of the global foundry market and physically manufactures the leading-edge silicon NVIDIA, AMD (NASDAQ:AMD), and Apple (NASDAQ:AAPL) actually ship. Intel promises to catch up. TSMC keeps shipping.

3. The geopolitical hedge is already happening. Xi’s “clash” rhetoric is loud, and the headlines will keep coming. The cost of acting on it would be catastrophic for Beijing: a blockade would sever China’s own access to advanced chips, gut its export economy, and invite sanctions that would dwarf anything imposed on Russia. TSMC is not waiting to test the theory. On May 12, the board approved a $20 billion capital injection into TSMC Arizona and $31.28 billion for additional advanced node capacity, while lifting the quarterly dividend to NT$7.00 per share. The Taiwan risk is being diversified in real time.

TSM trades at a P/E near 34, with a Wall Street consensus target of $463.45 against a recent close of $417.72. The stock is up 37.84% year to date without leverage, dilution, or a government cap table.

Skip the Intel turnaround hype. Put your research time into the foundry that is actually printing money.