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

Advanced Micro Devices (AMD) closed at $100.35 in the latest trading session, marking a -1.15% move from the prior day. This change lagged the S&P 500's 0.16% gain on the day.

Prior to today's trading, shares of the chipmaker had lost 8.31% over the past month. This has lagged the Computer and Technology sector's loss of 4.96% and the S&P 500's loss of 3.32% in that time.

Wall Street will be looking for positivity from AMD as it approaches its next earnings report date. On that day, AMD is projected to report earnings of $0.66 per share, which would represent year-over-year growth of 60.98%. Our most recent consensus estimate is calling for quarterly revenue of $4.12 billion, up 47.06% from the year-ago period.

AMD's full-year Zacks Consensus Estimates are calling for earnings of $2.50 per share and revenue of $15.66 billion. These results would represent year-over-year changes of +93.8% and +60.43%, respectively.

It is also important to note the recent changes to analyst estimates for AMD. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Within the past 30 days, our consensus EPS projection remained stagnant. AMD is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note AMD's current valuation metrics, including its Forward P/E ratio of 40.57. This represents a premium compared to its industry's average Forward P/E of 20.38.

Meanwhile, AMD's PEG ratio is currently 0.91. 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 1.52 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 154, putting it in the bottom 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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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.

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