Advanced Micro Devices (NASDAQ:AMD) Shares Climb 3% – Still a Buy?

Advanced Micro Devices, Inc. (NASDAQ:AMD)’s stock price was up 3% during mid-day trading on Friday. The company traded as high as $645.46 and last traded at $633.91. Approximately 19,298,957 shares traded hands during trading, a decline of 41% from the average daily volume of 32,866,156 shares. The stock had previously closed at $615.73.

Key Stories Impacting Advanced Micro Devices

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

• Positive Sentiment: $8.2 billion World Labs acquisition: AMD plans to acquire Fei-Fei Li’s spatial-intelligence AI startup in an all-stock transaction. Management expects the technology to help guide future chip development and expand AMD’s opportunity beyond the current GPU race. AMD bets on AI demand by buying World Labs
• Positive Sentiment: Evidence of accelerating AI demand: Hewlett Packard Enterprise secured a $1.2 billion Vultr order involving AMD Helios AI racks, providing a tangible data-center deployment signal for AMD’s processors and accelerators. HPE CFO discusses $1.2B deal with Vultr to deploy AMD Helios AI racks
• Positive Sentiment: Broad semiconductor strength and easier-rate expectations: Chip stocks rallied after weaker U.S. employment data reduced expectations for another Federal Reserve rate increase. AMD also benefited from investors’ view that it and Broadcom could lead the next phase of AI data-center construction. AMD stock gains, here’s why
• Neutral Sentiment: Long-term growth versus valuation: Bullish commentary points to expanding data-center revenue, autonomous-AI CPU demand, and large potential AI markets. However, AMD’s roughly $1 trillion market capitalization and elevated earnings multiple mean future gains depend on sustained growth and successful execution.
• Negative Sentiment: Risks remain substantial: The World Labs deal could dilute shareholders, while custom CPUs from hyperscalers may pressure AMD’s server market. Investors are also debating whether the recent rally has moved the stock near fair value, and some bearish analysts have expanded short positions. Advanced Micro Devices Is Spending $8.2 Billion to Learn What AI Needs Next

Wall Street Analysts Forecast Growth

A number of research firms have commented on AMD. Argus lifted their target price on Advanced Micro Devices from $450.00 to $625.00 and gave the company a “buy” rating in a research report on Thursday, August 6th. Barclays cut Advanced Micro Devices from an “overweight” rating to an “underweight” rating in a research note on Friday, June 12th. Zacks Research downgraded shares of Advanced Micro Devices from a “strong-buy” rating to a “hold” rating in a research report on Tuesday, September 1st. DA Davidson raised their target price on Advanced Micro Devices from $425.00 to $550.00 and gave the stock a “buy” rating in a research report on Wednesday, August 5th. Finally, Sanford C. Bernstein reaffirmed an “outperform” rating and set a $650.00 price objective on shares of Advanced Micro Devices in a report on Wednesday, August 5th. Three investment analysts have rated the stock with a Strong Buy rating, thirty-three have given a Buy rating, ten have issued a Hold rating and one has issued a Sell rating to the company. According to MarketBeat.com, Advanced Micro Devices currently has an average rating of “Moderate Buy” and a consensus price target of $567.62.

Advanced Micro Devices Trading Up 3.0%

The company has a current ratio of 2.61, a quick ratio of 1.91 and a debt-to-equity ratio of 0.03. The company has a market cap of $1.03 trillion, a PE ratio of 162.96, a price-to-earnings-growth ratio of 6.35 and a beta of 2.45. The business has a 50 day simple moving average of $510.41 and a two-hundred day simple moving average of $443.02.

Advanced Micro Devices (NASDAQ:AMD) last announced its quarterly earnings results on Tuesday, August 4th. The semiconductor manufacturer reported $1.66 EPS for the quarter, topping the consensus estimate of $1.62 by $0.04. The company had revenue of $11.54 billion during the quarter, compared to analyst estimates of $11.31 billion. Advanced Micro Devices had a return on equity of 12.30% and a net margin of 15.58%.The firm’s revenue was up 50.1% on a year-over-year basis. During the same period in the prior year, the firm posted $0.48 earnings per share. On average, analysts forecast that Advanced Micro Devices, Inc. will post 6.43 EPS for the current fiscal year.

Insider Transactions at Advanced Micro Devices

In related news, EVP Paul Grasby sold 15,000 shares of the firm’s stock in a transaction that occurred on Monday, August 17th. The stock was sold at an average price of $514.91, for a total value of $7,723,650.00. Following the sale, the executive vice president owned 117,687 shares of the company’s stock, valued at approximately $60,598,213.17. This trade represents a 11.30% decrease in their position. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, EVP Jean X. Hu sold 15,000 shares of the stock in a transaction dated Tuesday, August 25th. The shares were sold at an average price of $474.08, for a total transaction of $7,111,200.00. Following the completion of the transaction, the executive vice president owned 160,979 shares of the company’s stock, valued at $76,316,924.32. This represents a 8.52% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 213,838 shares of company stock valued at $105,533,836 over the last ninety days. Insiders own 0.50% of the company’s stock.

Hedge Funds Weigh In On Advanced Micro Devices

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Private Client Services LLC raised its position in shares of Advanced Micro Devices by 1.7% in the third quarter. Private Client Services LLC now owns 1,079 shares of the semiconductor manufacturer’s stock valued at $660,000 after purchasing an additional 18 shares during the period. Global Wealth Strategies & Associates boosted its stake in Advanced Micro Devices by 95.5% during the third quarter. Global Wealth Strategies & Associates now owns 1,118 shares of the semiconductor manufacturer’s stock worth $684,000 after buying an additional 546 shares in the last quarter. Versant Capital Management Inc raised its position in Advanced Micro Devices by 2.8% in the third quarter. Versant Capital Management Inc now owns 6,622 shares of the semiconductor manufacturer’s stock worth $4,109,000 after purchasing an additional 182 shares in the last quarter. Noble Wealth Management PBC boosted its stake in Advanced Micro Devices by 5.0% in the 3rd quarter. Noble Wealth Management PBC now owns 465 shares of the semiconductor manufacturer’s stock valued at $285,000 after buying an additional 22 shares in the last quarter. Finally, Burkett Financial Services LLC bought a new stake in shares of Advanced Micro Devices in the 3rd quarter worth about $117,000. Institutional investors own 71.34% of the company’s stock.

Advanced Micro Devices Company Profile

Advanced Micro Devices, Inc (NASDAQ: AMD) is a semiconductor company that designs high-performance computing, graphics and adaptive computing products. Its offerings serve data centers, personal computers, gaming systems, embedded devices and other specialized markets.

AMD’s product portfolio includes Ryzen processors for desktop and notebook computers, EPYC server processors, Radeon graphics products, and Instinct accelerators designed for artificial intelligence and high-performance computing workloads.