Advanced Micro Devices (NASDAQ:AMD) Shares Down 2% – Here’s Why

Shares of Advanced Micro Devices, Inc. (NASDAQ:AMD) traded down 2% on Friday. The company traded as low as $606.00 and last traded at $608.10. Approximately 13,622,787 shares were traded during mid-day trading, a decline of 58% from the average session volume of 32,504,850 shares. The stock had previously closed at $620.68.

Key Advanced Micro Devices News

Here are the key news stories impacting Advanced Micro Devices this week:

• Positive Sentiment: TSMC and Samsung reported strong results tied to AI-chip and memory demand, supporting the view that hyperscaler capital spending remains robust and that demand for AMD’s data-center products is durable. TSMC AI demand article
• Positive Sentiment: AMD is reportedly exploring a Samsung foundry and memory partnership, potentially improving access to constrained manufacturing and memory capacity as AI-chip demand outpaces supply. AMD Samsung partnership article
• Positive Sentiment: Analysts and industry coverage continue to identify upside from AMD’s expanding CPU, AI-accelerator and inference-chip businesses. Its next earnings report is scheduled for November 3, which could provide a catalyst if execution and guidance remain strong. AMD growth opportunity article
• Neutral Sentiment: AI infrastructure expansion remains a long-term demand driver, but progress depends on available power, permitted data centers and chip supply. Any slowdown in AI spending or faster expansion of capacity could moderate growth expectations. AMD market and AI infrastructure article
• Negative Sentiment: Valuation is the central concern. AMD traded near 125 times trailing free cash flow, versus roughly 46 times for Broadcom, meaning AMD must deliver substantially faster cash-flow growth to support its premium. AMD versus Broadcom valuation article
• Negative Sentiment: Higher Treasury yields and oil prices have pressured high-growth technology multiples, contributing to a broad semiconductor sell-off rather than signaling a new AMD-specific operational problem. Cathie Wood’s ARK Invest also sold approximately $14 million of AMD shares, adding a modest sentiment headwind. AMD market pressure article

Analysts Set New Price Targets

A number of equities research analysts have issued reports on the stock. Weiss Ratings reiterated a “hold (c+)” rating on shares of Advanced Micro Devices in a report on Monday, August 3rd. Royal Bank Of Canada restated a “sector perform” rating and issued a $540.00 price target on shares of Advanced Micro Devices in a research note on Wednesday, August 5th. DA Davidson upped their price objective on Advanced Micro Devices from $425.00 to $550.00 and gave the stock a “buy” rating in a research report on Wednesday, August 5th. Wall Street Zen upgraded Advanced Micro Devices from a “hold” rating to a “buy” rating in a report on Sunday, October 4th. Finally, Raymond James Financial upgraded Advanced Micro Devices from an “outperform” rating to a “strong-buy” rating and upped their price target for the stock from $565.00 to $641.00 in a report on Tuesday, August 25th. Three research analysts have rated the stock with a Strong Buy rating, thirty-one have issued a Buy rating, ten have assigned a Hold rating and one has given a Sell rating to the company’s stock. According to MarketBeat.com, Advanced Micro Devices has a consensus rating of “Moderate Buy” and a consensus target price of $585.26.

Advanced Micro Devices Trading Down 2.0%

The company has a debt-to-equity ratio of 0.03, a quick ratio of 1.91 and a current ratio of 2.61. The company’s 50-day moving average price is $526.31 and its 200-day moving average price is $458.39. The firm has a market capitalization of $992.71 billion, a PE ratio of 156.32, a PEG ratio of 6.69 and a beta of 2.45.

Advanced Micro Devices (NASDAQ:AMD) last posted its earnings results on Tuesday, August 4th. The semiconductor manufacturer reported $1.66 EPS for the quarter, beating the consensus estimate of $1.62 by $0.04. Advanced Micro Devices had a return on equity of 12.30% and a net margin of 15.58%.The firm had revenue of $11.54 billion for the quarter, compared to analyst estimates of $11.31 billion. During the same quarter in the prior year, the company posted $0.48 earnings per share. Advanced Micro Devices’s revenue for the quarter was up 50.1% compared to the same quarter last year. On average, sell-side analysts expect that Advanced Micro Devices, Inc. will post 6.43 earnings per share for the current year.

Insiders Place Their Bets

In other news, CEO Lisa Su sold 70,000 shares of the firm’s stock in a transaction dated Thursday, September 10th. The stock was sold at an average price of $506.80, for a total transaction of $35,476,000.00. Following the sale, the chief executive officer owned 3,032,156 shares of the company’s stock, valued at approximately $1,536,696,660.80. This trade represents a 2.26% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Paul Grasby sold 15,000 shares of the business’s stock in a transaction that occurred on Monday, August 17th. The stock was sold at an average price of $514.91, for a total value of $7,723,650.00. Following the sale, the executive vice president owned 117,687 shares of the company’s stock, valued at approximately $60,598,213.17. The trade was a 11.30% decrease in their position. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last quarter, insiders have sold 213,838 shares of company stock worth $105,533,836. 0.50% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

Several large investors have recently modified their holdings of AMD. MJT & Associates Financial Advisory Group Inc. acquired a new position in Advanced Micro Devices in the third quarter valued at $29,000. JNBA Financial Advisors increased its position in shares of Advanced Micro Devices by 142.9% during the second quarter. JNBA Financial Advisors now owns 51 shares of the semiconductor manufacturer’s stock worth $30,000 after purchasing an additional 30 shares in the last quarter. Bullseye Investment Management LLC purchased a new stake in shares of Advanced Micro Devices in the 2nd quarter valued at about $44,000. Luminist Capital LLC acquired a new stake in shares of Advanced Micro Devices in the 2nd quarter valued at about $46,000. Finally, BOK Financial Private Wealth Inc. acquired a new stake in shares of Advanced Micro Devices in the 2nd quarter valued at about $53,000. Institutional investors and hedge funds own 71.34% of the company’s stock.

Advanced Micro Devices Company Profile

Advanced Micro Devices, Inc (NASDAQ: AMD) is a semiconductor company that designs high-performance computing, graphics and adaptive computing products. Its offerings serve data centers, personal computers, gaming systems, embedded devices and other specialized markets.

AMD’s product portfolio includes Ryzen processors for desktop and notebook computers, EPYC server processors, Radeon graphics products, and Instinct accelerators designed for artificial intelligence and high-performance computing workloads.