It’s always impressive when a stock hits all-time highs
, but it’s all the more impressive after they’ve already rallied 600% in little more than two years. Shares of Advanced Micro Devices NASDAQ: AMD
have been on an absolute burner since the summer of 2018 and show no signs of slowing down
, with an 8% jump on Wednesday to push them into fresh blue sky territory.
The jump in shares builds on what’s been a stunning summer so far for the Santa Clara based company. They’re now up close to 70% since March with plenty of momentum to feed off as we head into Q3.
For example, at the end of June, management announced the achievement of a key goal that had been created back in 2014. They’d stated their intent at the time to increase mobile processor energy efficiency by 25x by 2020. With a big check mark being made against that last month, they and their consumers will now reap the rewards of a longer battery life, lower costs and a reduced environmental impact.
AMD Taking On Intel
Wednesday’s move comes on the back of their Ryzen 4000 chip launch for desktops, six months after they launched for laptops. AMD claims that their new chips offer 31% faster performance and 43% more performance per watt than Intel’s NASDAQ: INTC Core i7-9700 vPro.
This kind of fighting talk has some weight behind it. Over the past twelve months, AMD shares have rallied 90% compared to Intel’s 20%. Since the lows of March, AMD is up 40% to Intel’s 12%.
It’s clear who the fan favorite is and according to Bank of America analyst Vivek Arya, AMD has gotten into the PC market at the right time - he noted last week how AMD will be a key player in the “unexpected PC market revival”. Also last month, the company was tagged as one of those best positioned to capitalize on the upcoming new video game console releases. One of their core product offerings is a graphics processing unit (GPU) and both RBC and Bank of America highlighted the tailwind waiting for AMD towards the end of the year as next-generation consoles such as the Playstation 5 and Xbox Series X are released.
Taking On Nvidia
In the battle of GPUs, AMD’s Navi card is going head to head with Nvidia’s NASDAQ: NVDA Turing card. The latter has been around longer and so has achieved greater market penetration, but Navi is expected to put a large dent into that lead over the coming months. Compared to Intel, AMD has a tougher fight on their hands with Nvidia, whose shares are up 75% to AMD’s 40% since March. As this battle plays out though, investors are more than happy to feed off the overall video game industry hype as monthly active user numbers continue to trend up, thanks in a large part to coronavirus.
With their fiscal Q2 earnings due out in the coming weeks, Wall Street will be watching closely to see if AMD has managed to maintain if not build on last quarter’s numbers. At the end of April, the company reported a year on year revenue jump of 40%, no mean feat for a $70 billion company.
Things are continuing to go well for them as management continues to make all the right moves. The last time AMD broke above resistance and into blue sky territory was November last year. In the three months following that, shares tacked on another 70%, don’t be surprised if they do the same here
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