Given Intel’s prominence and standing in the Dow Jones Industrial Average for a quarter of a century, you’d think it would have performed like a superstar over the past decade.
it’s not.
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So how did this one-time tech darling fall short of expectations? If you invested $1,000 10 years ago, how much would you have today?
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10 years of unplanned growth
Ten years ago, Intel’s closing price was $26.95. As of this writing, it is trading at $35.57.
If you’re not a math whiz, you’ll earn a total of 31.98% for an average annual return of 3.19%.
Alas, if this conversation had taken place about a year ago, in March 2023, Intel would have had no merit in discussing it at all.
Indeed, Intel pays dividends on top of its price growth. However, its dividend yield has been on the decline over the past 10 years, dropping by more than half from 3.47% to around 1.39%. It’s not nothing, but it’s not a lot either.
On the other hand, if you invested in SPY (an index fund that tracks the S&P 500), you would almost survive a 169.15% price increase. Excluding the dividend yield (similar to Intel), which has averaged about 2% over the past 10 years, the average annual return is about 16.91%.
If you invested $1,000 in Intel 10 years ago, you would have bought 37.11 shares of INTC. Currently, those shares are worth a whopping $1,319.85. For comparison, an investment in SPY is worth more than twice as much at $2,690.55.
Intel: past, present, future
Intel remains dominant in central processing units (CPUs) for servers and computers, but has been slowly losing market share to rivals such as Advanced Micro Devices (AMD) and Nvidia for some time.
Intel has suffered from delays, management mistakes and, perhaps worst of all, missed opportunities. They famously missed out on the massive mobile device processing market. And today, they are also behind the race for artificial intelligence chips.
In a world where vast new data processing farms are needed to keep up with the AI ​​boom, Intel won’t be irrelevant anytime soon. But that doesn’t mean they’re ready to make a comeback either. In today’s technology race, its competitors seem far more capable, but there is little evidence that Intel has the cards to make up for lost ground.
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Investors beware.
GOBankingRates Details
This article originally appeared on GOBankingRates.com: How much is your $1,000 investment in Intel stock from 10 years ago worth today?
