Advanced Micro Devices (NASDAQ:AMD) Stock Jumps 11% - Here's Why

Key Points

• AMD shares jumped 11% to $449.04 in heavy trading, as chip stocks rebounded after a steep sector selloff; volatility may continue amid uncertainty over AI spending.
• Recent quarterly results beat estimates: revenue rose 44.7% year over year to $13.38 billion, with data-center revenue nearly doubling. CEO Lisa Su said AMD has visibility into customer data-center capacity needs through 2027.
• Analyst sentiment is broadly positive, with a “Moderate Buy” consensus and an average $633.17 price target, though some warn that AMD’s high valuation and competition from Nvidia and Arm could weigh on the stock.

Advanced Micro Devices, Inc. (NASDAQ:AMD - Get Free Report) shares rose 11% during mid-day trading on Friday. The stock traded as high as $459.80 and last traded at $449.04. 45,261,630 shares were traded during mid-day trading, an increase of 41% from the average session volume of 32,018,225 shares. The stock had previously closed at $404.40.

Trending Headlines about Advanced Micro Devices

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

• Positive Sentiment: AMD joined a broad semiconductor rebound as investors bought beaten-down chip stocks. The recovery followed a severe sector selloff, and analysts cautioned that volatility may persist. Nvidia, AMD and other chip stocks rebound. Is the ‘violent’ AI selloff over?
• Positive Sentiment: CEO Lisa Su called the market’s reaction to AI spending “short-sighted,” while saying AMD has good visibility into customer data-center capacity needs through 2027. Reports also point to expectations for accelerating AI business growth next year. AMD CEO Lisa Su Addresses AI Infrastructure Bottleneck Fears
• Positive Sentiment: Recent quarterly results beat analyst expectations, with revenue up 44.7% year over year; data-center revenue nearly doubled, strengthening the growth case behind the rebound. AMD Tops Q3 Earnings, Data Center Revenues Up 97%
• Negative Sentiment: A Seeking Alpha contributor downgraded AMD to Hold, citing a premium valuation, intensifying competition from Nvidia and Arm, and possible multiple compression if sector sentiment weakens. AMD: This Selloff Isn't Enough (Downgrade)
• Negative Sentiment: The broader AI-chip selloff reflects concerns about regulation, data-center investment costs and whether AI spending will deliver adequate returns. Those worries could keep AMD shares volatile despite its strong operating outlook. AI stocks hammered by midterm shock as data center buildout becomes a war of attrition

Analysts Set New Price Targets

Several equities analysts recently commented on the stock. Piper Sandler upped their price target on shares of Advanced Micro Devices from $600.00 to $650.00 and gave the stock an "overweight" rating in a research report on Wednesday. Union Gaming Research reiterated a "positive" rating on shares of Advanced Micro Devices in a report on Wednesday. Bank of America lowered their price objective on shares of Advanced Micro Devices from $720.00 to $650.00 and set a "buy" rating for the company in a research note on Wednesday. The Goldman Sachs Group restated a "buy" rating and set a $675.00 price objective on shares of Advanced Micro Devices in a report on Wednesday. Finally, Wells Fargo & Company cut their target price on Advanced Micro Devices from $700.00 to $650.00 and set an "overweight" rating on the stock in a research report on Wednesday. Three analysts have rated the stock with a Strong Buy rating, thirty-one have issued a Buy rating, nine have given a Hold rating and one has issued a Sell rating to the company. Based on data from MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and a consensus price target of $633.17.

Advanced Micro Devices Stock Up 11.0%

The firm has a 50-day simple moving average of $547.37 and a 200 day simple moving average of $413.90. The company has a debt-to-equity ratio of 0.10, a current ratio of 2.72 and a quick ratio of 1.91. The company has a market capitalization of $733.04 billion, a PE ratio of 97.62, a price-to-earnings-growth ratio of 5.01 and a beta of 2.49.

Advanced Micro Devices (NASDAQ:AMD - Get Free Report) last posted its quarterly earnings data on Tuesday, November 3rd. The semiconductor manufacturer reported $2.09 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.95 by $0.14. The company had revenue of $13.38 billion for the quarter, compared to analyst estimates of $13.10 billion. Advanced Micro Devices had a net margin of 16.77% and a return on equity of 14.15%. The business's quarterly revenue was up 44.7% on a year-over-year basis. During the same quarter last year, the firm posted $1.20 earnings per share. On average, research analysts predict that Advanced Micro Devices, Inc. will post 6.50 EPS for the current fiscal year.

Insider Transactions at Advanced Micro Devices

In other news, SVP Ava Hahn sold 2,993 shares of the business's stock in a transaction dated Tuesday, August 18th. The shares were sold at an average price of $488.69, for a total value of $1,462,649.17. Following the completion of the sale, the senior vice president owned 26,623 shares of the company's stock, valued at approximately $13,010,393.87. The trade was a 10.11% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Jean X. Hu sold 15,000 shares of the company's 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 sale, the executive vice president owned 160,979 shares in the company, valued at approximately $76,316,924.32. This trade represents a 8.52% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 231,100 shares of company stock valued at $114,867,400 over the last ninety days. 0.50% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Large investors have recently bought and sold shares of the company. Bank of America Corp DE acquired a new stake in Advanced Micro Devices in the 2nd quarter worth about $7,022,226,000. BlackRock Inc. raised its holdings in shares of Advanced Micro Devices by 3.1% during the second quarter. BlackRock Inc. now owns 150,301,510 shares of the semiconductor manufacturer's stock valued at $87,311,650,000 after acquiring an additional 4,535,126 shares during the last quarter. Jupiter Topco LLC acquired a new position in shares of Advanced Micro Devices during the second quarter valued at approximately $2,084,651,000. Wellington Management Group LLP raised its holdings in shares of Advanced Micro Devices by 33.9% during the second quarter. Wellington Management Group LLP now owns 9,334,396 shares of the semiconductor manufacturer's stock valued at $5,422,444,000 after acquiring an additional 2,365,419 shares during the last quarter. Finally, State Street Corp lifted its position in shares of Advanced Micro Devices by 2.9% in the second quarter. State Street Corp now owns 76,920,783 shares of the semiconductor manufacturer's stock valued at $46,606,266,000 after acquiring an additional 2,149,563 shares in the last quarter. Institutional investors own 71.34% of the company's stock.

Advanced Micro Devices Company Profile

Advanced Micro Devices, Inc (AMD) is a semiconductor company that designs processors, graphics products and adaptive computing solutions. Its products serve data center, personal computing, gaming, embedded and other markets. AMD is a fabless chip designer, relying on third-party manufacturing partners to produce its semiconductors.

The company's product portfolio includes EPYC server processors, Ryzen desktop and laptop processors, Radeon graphics products, Instinct accelerators for data center computing, and adaptive chips and systems used in embedded applications.

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