By all indications, Advanced Micro Devices (NASDAQ: AMD) is having a tougher time coping with crashing demand for PCs than rival Intel (NASDAQ: INTC) . That's the opposite of what Bernstein analyst Stacy Rasgon predicted early last year. When AMD earned a buy rating from Bernstein last February, that rating was partly based on the idea that AMD would hold up better in a tough PC market.
That view turned out to be wrong. Rasgon knocked down his rating on AMD to market perform on Tuesday, citing a deteriorating PC market and the fact that AMD is being hit harder by the downturn than Intel. Rasgon also lowered his price target on the stock from $95 to $80.
If you look at retail prices of AMD's PC CPUs, it's not a pretty picture. The company's latest Ryzen 7000 processors are currently selling at steep discounts to suggested prices on Amazon . The mainstream Ryzen 5 7600X, for example, can be bought for 17% less than the launch price, while the high-end Ryzen 9 7900X goes for 23% below launch price. Going back to previous-generation chips, discounts are even steeper.
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AMD Loses a Buy Rating, Thanks to a Terrible PC Market