BMO Capital analyst Ambrish Srivastava downgraded Intel (INTC) to Market Perform from Outperform and lowered his price target for the shares to $50 from $68.

The chipmaker closed yesterday down $1.24 to $49.24 during its analyst day.

Semi stocks do not do well in a decelerating gross margin environment, particularly when the bottom in margin is around two years away, Srivastava tells investors in a research note partially titled "Case of Clearly Overstaying Our Welcome." The analyst sees Intel shares, at best, "treading water." Commentary at the analyst day around the lowering of gross margin to a range of 57%-60% leaves Srivastava with a "discordant note."

AMD (AMD) is having an impact on Intel's business, and it has barely begun shipping its server products, writes the analyst. He does not expect Intel's gross margin to bottom out before 2021.