Advanced Micro Devices (NASDAQ:AMD) Trading Up 2.5% – Should You Buy?

Advanced Micro Devices, Inc. (NASDAQ:AMD)’s stock price shot up 2.5% during mid-day trading on Thursday . The company traded as high as $550.88 and last traded at $532.57. Approximately 26,768,615 shares were traded during mid-day trading, a decline of 29% from the average session volume of 37,708,262 shares. The stock had previously closed at $519.74.

Key Stories Impacting Advanced Micro Devices

Here are the key news stories impacting Advanced Micro Devices this week:

• Positive Sentiment: Wall Street sentiment remains upbeat, with multiple analysts raising AMD price targets in June, including a street-high call from UBS, as firms increasingly view AMD as a bigger player in AI infrastructure and data center CPUs.
• Positive Sentiment: AMD continues to gain credibility in enterprise AI, including recognition from Gartner as a leading server CPU company, which supports the long-term growth case for its data center business. Article Title
• Positive Sentiment: New business wins are also helping sentiment, including a definitive agreement with Rackspace Technology to deploy AMD-based infrastructure, reinforcing demand for AMD chips in cloud and enterprise workloads. Article Title
• Positive Sentiment: Several recent articles argue AMD still has meaningful upside as investors focus on its CPU and AI data center growth, with some bullish commentary suggesting the market may still be underappreciating its long-term earnings power.
• Neutral Sentiment: One recent piece highlighted both the positives and a caution on AMD, noting the stock’s huge six-month run and suggesting investors should stay aware of valuation risk after such a strong rally.
• Negative Sentiment: The semiconductor group has also been under pressure today, with AI chip names, including AMD, softening as momentum in the sector cools and investors rotate out of the space. Article Title
• Negative Sentiment: Bearish/neutral valuation commentary has also picked up, with some coverage questioning whether AMD’s rapid stock gains have already priced in a lot of future growth, which can weigh on the shares in the short term.

Analysts Set New Price Targets

A number of research firms recently commented on AMD. Needham & Company LLC upgraded Advanced Micro Devices to a “buy” rating in a research report on Wednesday, May 6th. Stifel Nicolaus boosted their price objective on Advanced Micro Devices from $320.00 to $450.00 and gave the stock a “buy” rating in a research note on Wednesday, May 6th. Weiss Ratings raised Advanced Micro Devices from a “hold (c)” rating to a “hold (c+)” rating in a research note on Wednesday, May 6th. Wells Fargo & Company increased their target price on Advanced Micro Devices from $345.00 to $505.00 and gave the stock an “overweight” rating in a report on Wednesday, May 6th. Finally, Oppenheimer lowered Advanced Micro Devices from a “market perform” rating to a “market perform” rating in a research note on Wednesday, May 6th. Two analysts have rated the stock with a Strong Buy rating, twenty-eight have assigned a Buy rating, twelve have assigned a Hold rating and one has given a Sell rating to the stock. According to MarketBeat.com, the company currently has a consensus rating of “Moderate Buy” and an average price target of $440.41.

Advanced Micro Devices Price Performance

The company has a 50 day moving average of $445.21 and a 200 day moving average of $296.11. The company has a current ratio of 2.72, a quick ratio of 1.96 and a debt-to-equity ratio of 0.04. The firm has a market cap of $850.49 billion, a price-to-earnings ratio of 171.01, a P/E/G ratio of 1.57 and a beta of 2.50.

Advanced Micro Devices (NASDAQ:AMD) last announced its quarterly earnings results on Tuesday, May 5th. The semiconductor manufacturer reported $1.37 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.29 by $0.08. Advanced Micro Devices had a return on equity of 9.55% and a net margin of 13.37%.The company had revenue of $10.25 billion during the quarter, compared to the consensus estimate of $9.90 billion. During the same period in the prior year, the company earned $0.96 earnings per share. The company’s revenue for the quarter was up 37.8% compared to the same quarter last year. Equities research analysts predict that Advanced Micro Devices, Inc. will post 6.15 EPS for the current fiscal year.

Insider Activity at Advanced Micro Devices

In other news, Director Nora Denzel sold 8,626 shares of the stock in a transaction on Tuesday, June 2nd. The shares were sold at an average price of $522.00, for a total transaction of $4,502,772.00. Following the completion of the sale, the director owned 87,173 shares of the company’s stock, valued at $45,504,306. This represents a 9.00% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, CEO Lisa T. Su sold 125,000 shares of the business’s stock in a transaction on Wednesday, June 10th. The shares were sold at an average price of $460.69, for a total transaction of $57,586,250.00. Following the completion of the sale, the chief executive officer directly owned 2,896,899 shares in the company, valued at $1,334,572,400.31. This represents a 4.14% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 378,032 shares of company stock valued at $161,876,596 over the last three months. Insiders own 0.50% of the company’s stock.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently modified their holdings of AMD. Clal Insurance Enterprises Holdings Ltd grew its stake in shares of Advanced Micro Devices by 12.8% during the 1st quarter. Clal Insurance Enterprises Holdings Ltd now owns 212 shares of the semiconductor manufacturer’s stock worth $43,000 after acquiring an additional 24 shares in the last quarter. CLG LLC boosted its holdings in Advanced Micro Devices by 3.1% during the first quarter. CLG LLC now owns 1,008 shares of the semiconductor manufacturer’s stock worth $205,000 after purchasing an additional 30 shares during the last quarter. Columbia Bank boosted its holdings in Advanced Micro Devices by 0.7% during the first quarter. Columbia Bank now owns 5,188 shares of the semiconductor manufacturer’s stock worth $1,055,000 after purchasing an additional 34 shares during the last quarter. Evolution Wealth Management Inc. grew its position in Advanced Micro Devices by 11.0% in the first quarter. Evolution Wealth Management Inc. now owns 352 shares of the semiconductor manufacturer’s stock valued at $72,000 after purchasing an additional 35 shares in the last quarter. Finally, Focused Wealth Management Inc grew its position in Advanced Micro Devices by 2.7% in the first quarter. Focused Wealth Management Inc now owns 1,431 shares of the semiconductor manufacturer’s stock valued at $291,000 after purchasing an additional 37 shares in the last quarter. 71.34% of the stock is owned by institutional investors and hedge funds.

Advanced Micro Devices Company Profile

Advanced Micro Devices, Inc (NASDAQ: AMD) is a global semiconductor company that designs and sells microprocessors, graphics processors, chipsets and adaptive computing solutions for a broad set of markets. The company’s product portfolio includes consumer and commercial CPUs under the Ryzen and Threadripper brands, data center processors under the EPYC brand, and Radeon graphics processing units for gaming and professional visualization. AMD also offers semi-custom system-on-chip (SoC) products for gaming consoles and other specialized applications, and provides supporting software and platform technologies for OEMs, cloud service providers and end users.

Founded in 1969, AMD has evolved from a supplier of logic chips into a diversified, fabless semiconductor designer.