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Advanced Micro Devices (AMD) Gains As Market Dips: What You Should Know

Advanced Micro Devices (AMD) closed at $19.90 in the latest trading session, marking a +0.2% move from the prior day. This change outpaced the S&P 500's 1.91% loss on the day. At the same time, the Dow lost 2.02%, and the tech-heavy Nasdaq lost 2.26%.

Coming into today, shares of the chipmaker had lost 7.58% in the past month. In that same time, the Computer and Technology sector lost 0.02%, while the S&P 500 lost 2.51%.

Wall Street will be looking for positivity from AMD as it approaches its next earnings report date. This is expected to be January 29, 2019. On that day, AMD is projected to report earnings of $0.09 per share, which would represent year-over-year growth of 12.5%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.45 billion, down 2.32% from the year-ago period.

AMD's full-year Zacks Consensus Estimates are calling for earnings of $0.46 per share and revenue of $6.53 billion. These results would represent year-over-year changes of +170.59% and +22.52%, respectively.

Any recent changes to analyst estimates for AMD should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.72% lower within the past month. AMD currently has a Zacks Rank of #3 (Hold).

In terms of valuation, AMD is currently trading at a Forward P/E ratio of 43.17. For comparison, its industry has an average Forward P/E of 16.27, which means AMD is trading at a premium to the group.

It is also worth noting that AMD currently has a PEG ratio of 3.08. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Electronics - Semiconductors industry currently had an average PEG ratio of 1.4 as of yesterday's close.

The Electronics - Semiconductors industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 74, putting it in the top 29% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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