04:33 PM EDT, 08/20/2025 (MT Newswires) -- Intel's ( INTC ) share price could go as high as around $40 in a valuation upside scenario, UBS Securities said in a note amid chatter around the Trump administration eyeing an equity stake in the chipmaker.

The White House is considering converting US Chips and Science Act grants into a 10% equity stake in Intel ( INTC ), Bloomberg News reported earlier this week. The company is in talks with other investors over an equity infusion, CNBC reported Wednesday, citing sources.

The chipmaker secured a $2 billion equity investment from Japan's SoftBank, the companies said in a joint statement late Monday.

"We have remained neutral though because we have seen upside limited by a lack of EPS power at the combined company level to sufficiently push the stock much higher than the mid $20 range," UBS analysts Timothy Arcuri said.

"If, however, the market started to put a more material 'valuation' on all of the piece of the business -- including an independent valuation for Intel's ( INTC ) manufacturing assets based on how other global foundry comps are valued per installed wafer of capacity -- we could see a case for an upside valuation of (around) $40/share," Arcuri wrote in a note e-mailed to MT Newswires on Wednesday.

However, the analyst acknowledged that "a lot would have to happen" for the upside scenario to materialize.

Intel ( INTC ) shares declined 7% to $23.54 on Wednesday, erasing a similar gain in the previous session.

UBS's upside framework values the products segment at $27 per share, with the foundry business at $14 per share, net of noncontrolling interest.

The Altera unit's valuation is seen at $1 per share, and the Mobileye division at $2. Taking into account the $3 per share impact from net debt, UBS puts the potential equity value of Intel ( INTC ) at $41 per share.

Intel ( INTC ) in April agreed to sell a majority stake in its Altera unit to technology-focused investment firm Silver Lake.

The stock's downside is "probably protected" by tangible book value of $17 to $18 after the Altera stake sale by the chipmaker, assuming costs are reduced to protect cash flow, Arcuri said.

Price: 23.57, Change: -1.75, Percent Change: -6.89