As 2024 approaches, investors seem to have a sense of optimism. Although it may be premature to label it a bull market, many beaten-down stocks appear to be on the rise.

One of these comeback stocks may be Intel (INTC -9.20%). After losing its technical lead in the last decade, it seems to have adopted a competitive mindset under CEO Pat Gelsinger.

Amid that strategic shift, the stock has risen from multiyear lows, and three factors could ensure that the semiconductor stock's recovery continues in 2024.

1. Improved competitiveness

After years in the wilderness and the loss of its technical lead to longtime rival Advanced Micro Devices, Intel seems ready to compete again. Soon after becoming CEO in 2021, Gelsinger set a goal of achieving technical parity with Intel's rivals by 2024 and claiming technical leadership by 2025.

To that end, it released its latest offerings, the Emerald Rapids Xeon processors and Meteor Lake mobile processors, in December. Admittedly, Intel's CPUs have not caught up to AMD's, according to analysts.

However, Emerald Rapids, a chip designed for artificial intelligence inference workloads, seems to outperform its AMD equivalent in some areas. Moreover, Meteor Lake's CPU power lags AMD's, but its iGPU may stand out over the Ryzen 7040 Phoenix. Such victories could leave Intel within striking distance of meeting its technical parity goals in 2024.

2. Intel's foundry business

As one of the few chip design companies still making most of its own chips, Intel has pivoted into the foundry business with Intel Foundry Services (IFS). This may seem like a strange move since Intel has outsourced some chip manufacturing to the dominant manufacturer, Taiwan Semiconductor (TSMC).

Nonetheless, Intel remains the largest chip manufacturer on U.S. soil, an asset when clients and governments have become upset about two-thirds of all third-party chip manufacturing in Taiwan. So far, clients like Amazon and the U.S. Department of Defense have turned to IFS for manufacturing.

Intel has also pledged tens of billions to build fabs in Arizona, Ohio, and the E.U. Moreover, it is receiving government subsidies to aid in this endeavor. Also, since TSMC and Intel buy ASML's top-of-the-line manufacturing equipment, Intel holds potential to compete with TSMC in the future.

3. Intel's financial and stock performance

Intel's financials show that a turnaround might have begun. In the first nine months of 2023, Intel's $39 billion in revenue amounted to a 21% revenue decline. Still, that decline falls to 8% when looking at Q3 only.

Also, Intel lost $980 million in the first three quarters of 2023, but the company earned a net income of $297 million in Q3, so a profit recovery may be at hand.

That was enough to increase Intel stock, which rose about 70% over the last year. With that, its forward P/E ratio has increased to 48.

Lagging profits likely elevated that metric. Still, when compared to AMD, Intel's price-to-sales (P/S) ratio of 4 is less than half of AMD's sales multiple of 10. The P/S ratio is also close to long-term historical averages, indicating the stock could continue moving higher if it can return to positive revenue growth.

Making sense of Intel stock

Gelsinger's approach of regaining technical leadership and becoming a leader in the foundry business has revived interest in Intel stock. Admittedly, it remains behind AMD by most measures and has not yet stopped its revenue decline.

However, Intel's chips have made enough improvements that customers and competitors will at least take notice. Additionally, demand for chips produced on U.S. soil plays into the hands of IFS, particularly with the money Intel has invested in a bid to boost its competitiveness. For these reasons, investors may want to consider Intel stock before valuations increase further.