Advanced Micro Devices (NASDAQ:AMD) Shares Down 1.2% - Should You Sell?

Key Points

• AMD shares fell 1.2% to $483.36 amid trading volume below average, while the stock remains richly valued with a market cap of about $788 billion and a P/E ratio above 124.
• AMD’s latest quarter beat expectations, with revenue up 50.1% year over year to $11.54 billion and EPS of $1.66; data-center growth and the planned acquisition of AI-inference chip specialist Taalas support the company’s competitive ambitions.
• Despite strong fundamentals and a “Moderate Buy” consensus with a $546.87 target price, investors remain concerned about conservative guidance, weakness in PC and gaming, margin uncertainty, and AMD’s ability to gain share from Nvidia.

Shares of Advanced Micro Devices, Inc. (NASDAQ:AMD - Get Free Report) were down 1.2% during trading on Friday . The stock traded as low as $476.06 and last traded at $483.36. Approximately 26,426,925 shares traded hands during mid-day trading, a decline of 27% from the average session volume of 36,159,789 shares. The stock had previously closed at $489.28.

More Advanced Micro Devices News

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

• Positive Sentiment: AMD agreed to acquire Toronto-based Taalas, a specialist in customized AI inference silicon. Integrating Taalas’ technology with AMD Instinct GPUs could improve inference speed and efficiency, strengthening AMD’s ability to compete with Nvidia in a rapidly expanding market. The purchase price was not disclosed. AMD deepens AI inference bet with Taalas deal
• Positive Sentiment: AMD’s second-quarter results exceeded estimates: revenue rose 50.1% year over year to $11.54 billion and EPS reached $1.66 versus a $1.62 consensus forecast. Data Center revenue more than doubled, while management provided a strong outlook, including approximately 41% expected growth. Several analysts remained bullish, with Rosenblatt raising its price target to $700 and JPMorgan lifting its target to $550, though JPMorgan retained a neutral rating. AMD Q2 earnings beat estimates
• Neutral Sentiment: Institutional filings showed PNC Financial and GF Fund Management increased their AMD holdings by roughly $166 million and $168 million, respectively, as of June 30. These purchases indicate institutional confidence but are lagging disclosures rather than a direct near-term catalyst.
• Negative Sentiment: The earnings reaction reflects a very high bar for AI growth. Investors were disappointed by the outlook’s perceived conservatism, near-term weakness in PC/client and gaming businesses, and uncertainty about margins and AMD’s ability to take meaningful share from Nvidia. With AMD trading at a premium valuation, strong execution was not enough to satisfy expectations. AMD drops after Q2 earnings

Analyst Ratings Changes

A number of research analysts have issued reports on AMD shares. Needham & Company LLC upgraded Advanced Micro Devices to a "buy" rating in a research report on Wednesday, May 6th. Loop Capital raised Advanced Micro Devices to a "strong-buy" rating in a report on Tuesday, June 16th. Wolfe Research set a $450.00 price objective on shares of Advanced Micro Devices and gave the company an "outperform" rating in a research note on Monday, June 15th. William Blair restated a "market perform" rating on shares of Advanced Micro Devices in a research report on Friday, July 24th. Finally, Benchmark increased their target price on shares of Advanced Micro Devices from $485.00 to $685.00 and gave the stock a "buy" rating in a research note on Wednesday, July 22nd. Three research analysts have rated the stock with a Strong Buy rating, thirty-one have assigned a Buy rating, ten have issued a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat.com, the company presently has an average rating of "Moderate Buy" and a consensus target price of $546.87.

Advanced Micro Devices Price Performance

The firm has a market cap of $788.17 billion, a price-to-earnings ratio of 124.26 and a beta of 2.48. The business has a 50 day simple moving average of $515.22 and a 200-day simple moving average of $358.23. The company has a debt-to-equity ratio of 0.03, a quick ratio of 1.96 and a current ratio of 2.61.

Advanced Micro Devices (NASDAQ:AMD - Get Free Report) last issued its quarterly earnings data on Tuesday, August 4th. The semiconductor manufacturer reported $1.66 earnings per share for the quarter, beating the consensus estimate of $1.62 by $0.04. Advanced Micro Devices had a return on equity of 12.30% and a net margin of 15.58%.The business had revenue of $11.54 billion for the quarter, compared to analysts' expectations of $11.31 billion. During the same period last year, the business earned $0.48 EPS. The business's revenue was up 50.1% on a year-over-year basis. Equities research analysts expect that Advanced Micro Devices, Inc. will post 6.34 earnings per share for the current year.

Insiders Place Their Bets

In other Advanced Micro Devices news, EVP Mark D. Papermaster sold 6,000 shares of the company's stock in a transaction on Monday, June 15th. The stock was sold at an average price of $536.33, for a total value of $3,217,980.00. Following the completion of the transaction, the executive vice president owned 1,233,687 shares in the company, valued at $661,663,348.71. This represents a 0.48% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Nora Denzel sold 8,626 shares of the stock in a transaction dated 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 transaction, the director owned 87,173 shares of the company's stock, valued at approximately $45,504,306. The trade was a 9.00% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold a total of 285,934 shares of company stock worth $130,353,006 in the last ninety days. Company insiders own 0.50% of the company's stock.

Institutional Trading of Advanced Micro Devices

Several hedge funds and other institutional investors have recently modified their holdings of AMD. First National Bank of Hutchinson lifted its holdings in Advanced Micro Devices by 0.4% in the 2nd quarter. First National Bank of Hutchinson now owns 5,639 shares of the semiconductor manufacturer's stock worth $3,276,000 after purchasing an additional 22 shares during the last quarter. Clal Insurance Enterprises Holdings Ltd boosted its position in shares of Advanced Micro Devices by 12.8% in the first quarter. Clal Insurance Enterprises Holdings Ltd now owns 212 shares of the semiconductor manufacturer's stock valued at $43,000 after acquiring an additional 24 shares during the period. Trust Co of the South boosted its position in shares of Advanced Micro Devices by 1.5% in the second quarter. Trust Co of the South now owns 1,746 shares of the semiconductor manufacturer's stock valued at $1,014,000 after acquiring an additional 25 shares during the period. Beaird Harris Wealth Management LLC increased its holdings in shares of Advanced Micro Devices by 9.4% during the 2nd quarter. Beaird Harris Wealth Management LLC now owns 292 shares of the semiconductor manufacturer's stock worth $169,000 after purchasing an additional 25 shares during the period. Finally, Veery Capital LLC increased its stake in Advanced Micro Devices by 1.0% during the second quarter. Veery Capital LLC now owns 2,793 shares of the semiconductor manufacturer's stock valued at $1,622,000 after acquiring an additional 27 shares during the period. Institutional investors own 71.34% of the company's stock.

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.

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