2024-06-18 09:19:29 ET
Summary
- Since I rated Advanced Micro Devices, Inc. a "Hold" in March 2024, the stock has declined by 22%, while its direct peer, Nvidia, has managed to grow by 59% over the same period.
- Despite AMD's significant decline - both on an absolute basis and relative to its main peer - I still see the risk of a further decline.
- AMD's seemingly cheaper valuation multiples are explained by lowered estimates for future earnings.
- I acknowledge the company's efforts to compete in the GPU market and provide formidable competition to its more successful rival, but the challenges I pointed out in my last article remain.
- AMD is a "Hold" until I see Q2 numbers.
My Thesis
I initiated coverage on Advanced Micro Devices, Inc. ( AMD ) stock on March 1, 2024, with a "Hold" rating, outlining my concerns about the sustainability of the stock's rally at that time. Since then, AMD has declined by about 22%, while its direct peer, Nvidia ( NVDA ), has managed to grow by 59% over the same period....
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AMD Stock: Challenges Remain