Advanced Micro Devices (NASDAQ:AMD) Shares Down 1.7% - Here's What Happened

Key Points

• AMD shares fell 1.7% in mid-day trading, even as the stock has seen heavy volume and continued strong interest from investors. The shares traded below the previous close after reaching an intraday low of $486.66.
• Fundamentals remain strong, with AMD’s latest earnings beating expectations on both EPS and revenue. The company’s data center business is a major growth driver, with Q1 data center revenue up 57% year over year.
• Wall Street remains bullish overall, despite some valuation concerns and rising competition from Nvidia in server CPUs. Analysts currently rate AMD a Moderate Buy on average, with several recent price targets well above the current share price.

Shares of Advanced Micro Devices, Inc. (NASDAQ:AMD - Get Free Report) fell 1.7% during mid-day trading on Wednesday . The company traded as low as $486.66 and last traded at $495.54. 27,239,117 shares traded hands during mid-day trading, a decline of 30% from the average session volume of 39,045,230 shares. The stock had previously closed at $503.89.

Advanced Micro Devices News Summary

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

• Positive Sentiment: AMD’s data center business is still the main growth engine, with Q1 data center revenue up 57% to $5.78 billion as EPYC CPUs and Instinct AI accelerators gain traction. That supports the case for more upside if AI spending keeps expanding. Article Title
• Positive Sentiment: New AI infrastructure wins are reinforcing AMD’s growth story, including OneQode’s rollout of AMD Instinct MI355X GPUs and plans to use AMD’s Helios rack-scale platform. Article Title
• Positive Sentiment: Several market commentaries argue AMD remains a major beneficiary of the AI build-out, with analysts and investors pointing to further upside potential and continued strength in the chip cycle. Article Title
• Neutral Sentiment: AMD remains widely viewed favorably by Wall Street, with recent analyst coverage showing a “Moderate Buy” consensus and multiple bullish price targets, including a fresh $579 target from Evercore ISI. Article Title
• Negative Sentiment: Competition is intensifying, as Nvidia is moving toward the standalone server CPU market, which could pressure AMD’s long-term share in data center chips. Article Title
• Negative Sentiment: Some investors are cautioning that AMD’s stock has run far ahead of fundamentals after a huge rally, making valuation a key risk even if AI demand stays strong. Article Title

Analysts Set New Price Targets

A number of brokerages have issued reports on AMD. Sanford C. Bernstein raised shares of Advanced Micro Devices from a "market perform" rating to an "outperform" rating and upped their price objective for the stock from $265.00 to $525.00 in a research report on Wednesday, May 6th. Evercore reissued an "outperform" rating and set a $579.00 target price on shares of Advanced Micro Devices in a research report on Tuesday, May 19th. KeyCorp increased their target price on shares of Advanced Micro Devices from $330.00 to $530.00 and gave the company an "overweight" rating in a research report on Wednesday, May 6th. HSBC downgraded shares of Advanced Micro Devices from a "buy" rating to a "hold" rating and increased their target price for the company from $335.00 to $340.00 in a research report on Monday, May 4th. Finally, Zacks Research raised shares of Advanced Micro Devices from a "hold" rating to a "strong-buy" rating in a research report on Tuesday, May 5th. Two investment analysts have rated the stock with a Strong Buy rating, thirty have given a Buy rating and twelve have issued a Hold rating to the company. According to data from MarketBeat.com, Advanced Micro Devices has an average rating of "Moderate Buy" and a consensus target price of $410.00.

Advanced Micro Devices Stock Down 1.7%

The company has a market capitalization of $808.03 billion, a PE ratio of 162.47, a PEG ratio of 1.37 and a beta of 2.40. The company has a debt-to-equity ratio of 0.04, a quick ratio of 1.96 and a current ratio of 2.72. The stock's 50 day moving average is $309.03 and its 200 day moving average is $250.05.

Advanced Micro Devices (NASDAQ:AMD - Get Free Report) last announced its quarterly earnings results on Tuesday, May 5th. The semiconductor manufacturer reported $1.37 EPS for the quarter, beating analysts' consensus estimates of $1.29 by $0.08. The company had revenue of $10.25 billion for the quarter, compared to analysts' expectations of $9.90 billion. Advanced Micro Devices had a net margin of 13.37% and a return on equity of 9.55%. Advanced Micro Devices's revenue was up 37.8% compared to the same quarter last year. During the same period in the prior year, the company posted $0.96 EPS. On average, sell-side analysts anticipate that Advanced Micro Devices, Inc. will post 6.2 EPS for the current fiscal year.

Insider Buying and Selling at Advanced Micro Devices

In related news, EVP Mark D. Papermaster sold 31,320 shares of the company's stock in a transaction that occurred on Friday, April 24th. The shares were sold at an average price of $350.00, for a total transaction of $10,962,000.00. Following the sale, the executive vice president directly owned 1,236,037 shares in the company, valued at approximately $432,612,950. This represents a 2.47% decrease in their position. The sale was disclosed in a filing with the SEC, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Lisa T. Su sold 125,000 shares of the company's stock in a transaction that occurred on Wednesday, May 13th. The shares were sold at an average price of $445.51, for a total transaction of $55,688,750.00. Following the sale, the chief executive officer owned 3,021,899 shares in the company, valued at $1,346,286,223.49. The trade was a 3.97% 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. Over the last 90 days, insiders have sold 329,085 shares of company stock valued at $114,051,007. 0.50% of the stock is owned by corporate insiders.

Institutional Trading of Advanced Micro Devices

Institutional investors and hedge funds have recently bought and sold shares of the company. Joseph Group Capital Management purchased a new stake in Advanced Micro Devices in the 4th quarter worth approximately $25,000. Cornerstone Financial Management LLC purchased a new stake in Advanced Micro Devices in the 4th quarter worth approximately $27,000. Sarver Vrooman Wealth Advisors purchased a new stake in Advanced Micro Devices in the 4th quarter worth approximately $27,000. Basepoint Wealth LLC purchased a new stake in Advanced Micro Devices in the 4th quarter worth approximately $30,000. Finally, Graney & King LLC purchased a new stake in Advanced Micro Devices in the 1st quarter worth approximately $31,000. 71.34% of the stock is currently owned by hedge funds and other institutional investors.

About Advanced Micro Devices

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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