Intel on target to regain tech leadership, foundry a necessity: Northland
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Intel's (NASDAQ:INTC) looks as if it is on target to regain its technology leadership from its competitors, according to investment firm Northland Capital Markets, but it's the chip giants's push to be a global foundry that is seen as a necessity. 
Analyst Gus Richard, who reiterated his outperform rating and per-share price target of $45 on Intel (INTC), said it looks as if Intel is catching up with AMD (AMD) and Nvidia (NVDA) when it comes to process technology. However, the transformation to create a profitable foundry business for external customers is likely to help the company's financials.
Richard added that Intel (INTC) could fill its older fabs with foundry customers and that should fix the company's business model. 
Intel's (INTC) transition to become a successful foundry is no sure thing, Richard conceded, as it goes up against the likes of Taiwan Semiconductor (TSM), GlobalFoundries (GFS) and others. However, if it does succeed in the transition, led by CEO Pat Gelsinger, it could generate high margin, leading edge revenue from its internal products and decent trailing gross margins from its foundry business.
For more advanced nodes, Richard suggested Intel (INTC) could have customers like Google (GOOG) (GOOGL), Amazon (AMZN) and Microsoft (MSFT). Last month, Intel announced an update on its foundry business but did not announce any customers at the event.
Intel (INTC) shares fell more than 2.5% in late trading on Wednesday.
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Updated to include additional information from the research note.