AMD Buy Sell or Hold: A Balanced Look at the Chipmaker's Prospects

AMD has made significant strides in recent years, with a strong lineup of Ryzen processors and Radeon graphics cards. The company's focus on high-performance computing and gaming has resonated with enthusiasts and professionals alike.

AMD's market share has been steadily increasing, reaching a significant 40% of the global CPU market in 2020. This is a testament to the company's ability to compete with industry leader Intel.

The chipmaker's acquisition of Xilinx in 2021 has also been a major boost, providing AMD with access to cutting-edge FPGA technology. This strategic move positions AMD well for future growth in the emerging 5G and AI markets.

However, AMD still faces stiff competition from Intel, which has a long history of innovation and a strong reputation among consumers.

AMD matched Wall Street's earnings target for the third quarter, but its revenue guidance for the current period was a bit light. This caused AMD stock to tumble 10.6% during the next regular trading session.

Advanced Micro Devices earned an adjusted 92 cents a share on sales of $6.82 billion in the September-ended quarter, with earnings rising 31% year over year and sales increasing 18%. Analysts polled by FactSet had expected AMD earnings of 92 cents a share on sales of $6.71 billion.

AMD predicted sales of $7.5 billion for the current quarter, up 22% year over year, but this forecast is a tad below Wall Street's estimate of $7.55 billion in Q4 sales. Analysts are in good agreement that the stock price will rise by 51.8%.

Earnings are forecast to grow 40% per year, and 44 stock analysts on Stockchase covered AMD in the last year, making it a trending stock worth watching. The average price target for Advanced Micro Devices comes to $188.36, representing an increase of 55.94% from the last closing price of $120.79.

Based on short-term price targets offered by 36 analysts, the forecasts range from a low of $145.00 to a high of $250.00. AMD operates as a semiconductor company worldwide and is trading at 55.4% below its estimated fair value.

AMD's financial performance has been a mixed bag. The company's stock is trading at 55.4% below its estimated fair value.

AMD's earnings are forecast to grow 40% per year, which is a promising sign. However, the stock price has actually declined by 11.2% over the past year.

In comparison, the US Semiconductor industry has returned 79.6% over the past year, while the US Market has returned 24.5%. AMD underperformed both of these benchmarks.

Here's a quick comparison of AMD's performance over the past 7 days and 1 year:

Stock prices are constantly changing and can be affected by various market factors.

On a specific day, such as January 2nd, 2025, the stock price of Advanced Micro Devices (AMD-Q) closed at $120.63.

This price is an important indicator of a company's financial performance.

The stock price of AMD-Q can fluctuate daily, so it's essential to monitor it regularly.

For instance, if you were watching the stock price of AMD-Q on January 2nd, 2025, you would have known its closing price.

Regularly tracking stock prices can help you make informed investment decisions.

You can even add stocks to a watchlist to monitor them daily and receive important alerts.

This way, you'll be the first to know if the stock price changes significantly.

The after-market price for NSDQ is currently at $121.08, with a gain of $0.45, or 0.37%, as of 7:58 PM ET.

This price movement can be seen in the context of the stock's Zacks Rank, which is a timeliness indicator for stocks over the next 1 to 3 months. The Zacks Rank is based on the stock's annualized return, with a Strong Buy (Zacks Rank #1) having an annualized return of 24.35%.

Here's a breakdown of the Zacks Rank and its corresponding annualized returns:

The Style Scores, which are a complementary set of indicators to the Zacks Rank, also provide valuable insights into the stock's performance. The scores are based on the trading styles of Value, Growth, and Momentum, with NSDQ having a Value Score of A, a Growth Score of A, and a Momentum Score of A.

Let's take a look at the shareholder returns for AMD and how they compare to the broader market.

In the past 7 days, AMD's shareholder returns were -3.4%, which is slightly better than the US Semiconductor industry's -4.1% return.

The US Market as a whole returned -2.6% over the same period.

Looking at the past year, AMD's shareholder returns were -11.2%, significantly underperforming the US Semiconductor industry's 79.6% return.

The US Market also outperformed AMD, returning 24.5% over the past year.

Here's a comparison of the shareholder returns for AMD, the US Semiconductor industry, and the US Market over the past 7 days and 1 year:

The current share price of AMD is a respectable $120.79, which is a significant milestone after its epic recovery from a nearly four-decade low of $1.61 a share in July 2015.

AMD's share price has seen its fair share of ups and downs, with a 52-week high of $227.30 and a 52-week low of $117.90. This fluctuation is reflected in the stock's beta, which stands at 1.64, indicating a relatively high level of volatility.

Here's a breakdown of AMD's price performance over the past year:

As you can see, AMD's share price has had its share of wild swings, but the five-year change is a staggering 146.66%, indicating a remarkable recovery from its IPO.

AMD operates in a highly competitive market, particularly in the semiconductor industry where it faces off against Nvidia. AMD's rivalry with Nvidia is heating up, with AMD working to catch up in the AI and chip sectors.

Nvidia's success last year highlighted the gap between the two companies, but AMD has been making strides to close the gap. AMD unveiled a line of AI GPUs that attracted prominent cloud companies like Microsoft's Azure, Meta Platforms, and Oracle.

AMD's acquisition of server maker ZT Systems for $5 billion is a significant move to expand its access to powerful AI chips and hardware. This acquisition will allow AMD to release its latest AI GPUs more quickly at a scale necessary for cloud platforms like Azure.

The acquisition of ZT Systems is expected to positively affect AMD's earnings as early as the end of 2025. This could be a game-changer for AMD, helping it to compete more effectively with Nvidia.

The Nasdaq: AMD stock is listed on the NASDAQ exchange under the ticker symbol AMD. The company has been analyzed by 44 stock analysts in the last year.

22 out of these 44 analysts recommended buying the stock, while 13 analysts suggested selling it.

AMD's price volatility is a key consideration for investors. The company's average weekly movement is 5.8%, which is lower than the semiconductor industry average of 7.4% and the market average of 6.3%.

This stability is a positive sign for investors, especially in a market that can be unpredictable. AMD's weekly volatility has been stable over the past year, with a weekly movement of 6%.

Compared to other stocks in the US market, AMD's volatility is relatively low. The 10% most volatile stocks in the US market have an average weekly movement of 17.7%, while the 10% least volatile stocks have an average weekly movement of 3.1%.

Here's a comparison of AMD's volatility with industry and market averages:

Overall, AMD's price volatility is relatively low compared to other stocks in the market, making it a potentially attractive option for investors seeking stability.

AMD's rivalry with Nvidia is heating up, thanks to a recent acquisition that's giving them a major boost. AMD is buying server maker ZT Systems for $5 billion, which will help them access powerful AI chips and hardware.

This move is a big deal because training AI models requires intensive workloads that combine thousands of chips to power massive server systems. With ZT Systems on board, AMD will be able to release their latest AI GPUs more quickly at a scale necessary for cloud platforms like Azure.

AMD's CEO Lisa Su said the acquisition will allow them to sell more GPUs, which should positively affect their earnings as early as the end of 2025. This is a step in the right direction, especially considering the scale of Nvidia's business, which surged last year thanks to their AI graphics processing units (GPUs).