Among the legacy tech stocks that don’t get enough attention, Intel (NASDAQ:INTC) stock has been on my radar for some time.

Why, you may ask?

Well, the company’s valuation of less than 15 times earnings is one that’s hard to ignore. And the company’s exposure to the broad technology sector, and the strong long-term catalysts supporting this space, certainly provide a robust and stable outlook, at least relative to other more speculative names in the tech world.

Of course, Intel’s exposure to the PC market isn’t glorious. This is a sector that’s likely to be in decline and could get hit hard by an upcoming recession. That is if the economic indicators are correct in predicting one right around the corner. So, there’s certainly some cyclicality to be factored into INTC stock.

That said, I think this is a legacy tech name that’s worth considering right now. Here’s why.

Revenue Declining

Let’s start with what’s wrong before we get to what’s going right with Intel.

The current PC market is in secular decline, and intense rivalry from Advanced Micro Devices (NASDAQ:AMD) and other peers isn’t helping. Intel’s once-massive market share lead in the chips space is dwindling, and over the long term, many experts think that the company is likely to lose pace even faster relative to the competition. 

According to Intel’s Q1 2023 forecast, sales will come in at $11 billion at the median of its guidance range. This would represent a decline of 37% from the $18.4 billion in sales from the prior year.

The company also expects an estimated loss of 15 cents per share in the first quarter of 2023, a significant decrease from the 87 cents per share in profit the company posted in the same quarter last year. 

That’s not good.

Why INTC Stock Is Rallying

INTC stock is up nearly 10% on a year-to-date basis at the time of writing, a rather incredible move, considering the aforementioned headwinds.

The recent surge in Intel’s stock can be attributed to hopes that the PC market may soon hit bottom. However, a closer look at the data given by the economic analysis company IDC reveals that this might not happen for some time. In 2023, the company expects PC revenues to decrease by 10.7% to 260.8 million units, indicating a more significant drop than the somewhat optimistic projection at the end of 2022. IDC projected a smaller decline of 6.5% to 281 million units then.

IDC’s latest forecast shows that the PC market is expected to recover in 2024, while 2023 will be a year focused on inventory clearance. If this holds, it is likely that Intel’s client computing group, which accounted for half of the company’s revenue in 2022 and includes the sales of processors used in desktops, notebooks, and workstation PCs, will reach its bottom sometime soon.

There Is Still Hope for Intel

AMD will solidify its standing in the PC CPU industry in the initial quarter of 2023, eroding additional market share from Intel. PassMark Software estimates that AMD’s PC CPU market share will increase from 41.4% to 44.4% in 2023. With a projected share of 23.6% in the most recent quarter—a 40 basis mark rise from the prior year—AMD generated significant progress in the computer CPU market.

However, Intel is banking on its latest 4th-generation Sapphire Rapids server processors to counterbalance the market share decline against Advanced Micro Devices. The company stated that the processors have gained over 450 design wins and have been chosen for deployment by more than 50 original equipment manufacturers and original design manufacturers. Intel is confident its latest server processors will be in high demand throughout the year.

What Now

According to analysts, Intel’s financial performance for 2023 is anticipated to be dismal. According to analyst forecasts, the enterprise’s sales might drop by 19% to $50.8 billion, whereas normalized profits per share are predicted to drop from $1.84 in 2022 to $0.53 this 2023. Nevertheless, analysts remain optimistic about a significant rebound for the company in 2024.

Investors should be cautious before buying Intel stock despite recent gains, as a turnaround in the PC market and competition with AMD are necessary for a sustained recovery. Waiting for evidence of a reversal may be prudent, particularly given Intel’s high forward price-earnings ratio of 67 times.

That said, if the company can hold its ground better than expected, perhaps its forward multiple will be closer to its trailing multiple than the projected 67-times number. Additionally, if the company’s Saphire Rapids server processors can pick up the market share analysts’ project, this is a company that may not be dead in the water, as many expect.

We’ll have to see. For now, this is one legacy stock I think is worth a look at on significant dips, especially considering this stock does provide a small but meaningful dividend yield of 1.7%.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.