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AMD stock - what's going on?
Posted on 3/3/21 at 1:02 pm
Posted on 3/3/21 at 1:02 pm
So I follow AMD real close (computer nerd among other things), and I'm having a hard time believing how this stock has been in a constant downturn the last few weeks, it was up around $95 just a few weeks ago, now sitting near $81. Price targets on it are almost all way above the 80s and even 90s.
As a company, continue to be in a very high growth time period for them where they are really wrecking competition from Intel in CPU space and giving Nvidia in GPU space some nightmares. On top of that, they secured the chips for the new Xbox and Playstation. In the console space and graphics card space, you almost literally cant buy the things because demand is outrageous right now between good new products for gamers, miners, among other things.
Just trying to wrap my head around AMD's price continually falling the last few weeks. I guess potentially many just taking profits from hitting highs earlier, but this year is poised to be even bigger than it was last year for them with an extremely positive future outlook.
Edit - and it's back, finally
As a company, continue to be in a very high growth time period for them where they are really wrecking competition from Intel in CPU space and giving Nvidia in GPU space some nightmares. On top of that, they secured the chips for the new Xbox and Playstation. In the console space and graphics card space, you almost literally cant buy the things because demand is outrageous right now between good new products for gamers, miners, among other things.
Just trying to wrap my head around AMD's price continually falling the last few weeks. I guess potentially many just taking profits from hitting highs earlier, but this year is poised to be even bigger than it was last year for them with an extremely positive future outlook.
Edit - and it's back, finally
This post was edited on 7/28/21 at 2:13 pm
9
Posted on 3/3/21 at 1:06 pm to thunderbird1100
quote:
Just trying to wrap my head around AMD's price continually falling the last few weeks.
Dude it's not just AMD but all tech stocks are getting massacred today. ROKU, ETSY, PINS, etc. Fire sales abound, but it could be a falling knife!
This post was edited on 3/3/21 at 1:14 pm
Posted on 3/3/21 at 1:11 pm to thunderbird1100
You are up 80% YoY, PE is over 40 for a semi company is above average.
Most of the news is already priced in, they need to execute at perfection to continue the run up. People are probably rightfully taking profits.
Most of the news is already priced in, they need to execute at perfection to continue the run up. People are probably rightfully taking profits.
Posted on 3/3/21 at 1:12 pm to GeneralLee
Likely part of the "rotation" I've been hearing about from tech stocks to cyclicals.
Posted on 3/3/21 at 1:12 pm to GeneralLee
quote:
Dude is not just AMD but all tech stocks are getting massacred today. ROKU, ETSY, PINS, etc. Fire sales abound, but it could be a falling knife!
I would understand more pandemic driven overvalued tech stocks, but AMD's rise has almost nothing to due with the pandemic really.
At $81 it's pretty undervalued. Especially where they are going, pandemic or not. Intel is in full on catch up mode and producing the chips for the 2 new major consoles is a big deal. Not to mention keep counterpunching Nvidia in the GPU space where everything is sold out (from both companies) currently.
This post was edited on 3/3/21 at 1:16 pm
Posted on 3/3/21 at 1:12 pm to thunderbird1100
Prepare to get blasted for asking a question. You are not seeing what you are seeing
Posted on 3/3/21 at 1:28 pm to thunderbird1100
Go look at Nasdaq and come back
Posted on 3/3/21 at 1:31 pm to MrJimBeam
quote:
Go look at Nasdaq and come back
I get the overvalued tech stocks due to pandemic and stuff, especially now that we're on our way out from there, but this doesnt really fall in line with all that. Other than people seemingly just lumping it in with the rest of tech stocks.
Posted on 3/3/21 at 1:35 pm to thunderbird1100
Stocks don't always go up in a straight line. Corrections are going to happen and they happen to all stocks no matter how positive the outlook is and no matter how good the earnings are. This is where you find out if you are a trader or a long term investor. I've had AMD for about five years and it has had a hell of a run. In that time it has had several corrections, at least one probably in the 50% range.
Posted on 3/3/21 at 1:39 pm to CajunTiger92
quote:
Stocks don't always go up in a straight line. Corrections are going to happen and they happen to all stocks no matter how positive the outlook is and no matter how good the earnings are. This is where you find out if you are a trader or a long term investor. I've had AMD for about five years and it has had a hell of a run. In that time it has had several corrections, at least one probably in the 50% range.
Well aware of all that, just looking to see if anyone had anything tangible on why AMD has fallen so much in the last couple weeks outside of people just taking profits or simply wrongly lumping them in with the rest of tech that's overvalued like Shopify or Zoom due to pandemic.
Posted on 3/3/21 at 1:42 pm to thunderbird1100
If you think the value exceeds the price, buy.
If you think price exceeds value, sell.
Semis are a good spot with EVs growth.
If you think price exceeds value, sell.
Semis are a good spot with EVs growth.
Posted on 3/3/21 at 1:43 pm to thunderbird1100
quote:
simply wrongly lumping them in with the rest of tech that's overvalue
I would think there is some worry for sure that AMD is currently overvalued due to the chip shortage and sales will be unable to meet current estimates. They even said so after the last earnings.
quote:
AMD CEO Lisa Su said the shortages primarily impact the gaming (both consoles and gaming CPUs and GPUs) and the low end of the PC market, and overall demand has exceeded its planning. That's particularly challenging given that, in the first quarter of availability, the company's Ryzen 5000 processors have sold twice the number of units compared to any other Ryzen series in history. Su expects to see 'tightness' throughout the first half of 2021 until added production capacity comes online. That means we could see a limited supply of AMD's PC and console chips until the middle of the year. Su also explicitly called out the low end of the PC market and consoles as being impacted the most, meaning higher-margin products are more readily available at retail. Interestingly, AMD's inventory swelled during the quarter, reaching $1.4 billion in unsold goods (up from $930 million the prior quarter), which seems odd given that the company has unmet demand. An AMD representative tells us that the company's inventory values can consist of chips in various stages of production, so it's possible that AMD's increased wafer starts at TSMC has resulted in more chips in various stages of production. AMD also confirms that packaging shortages continue to be a pinch point in the supply chain. That implies that there could be plenty of chip dies also awaiting packaging, meaning lithographic capacity at TSMC (i.e., wafer starts) aren't the only factor impacting the company's ability to deliver chips.
AMD is fabless so they are really at the mercy of TSMC. Still seems like short term noise, but would pressure near term earnings
This post was edited on 3/3/21 at 1:44 pm
Posted on 3/3/21 at 1:48 pm to thunderbird1100
quote:
At $81 it's pretty undervalued. Especially where they are going, pandemic or not. Intel is in full on catch up mode and producing the chips for the 2 new major consoles is a big deal. Not to mention keep counterpunching Nvidia in the GPU space where everything is sold out (from both companies) currently.
You're only looking at this from a consumer perspective. Intel and NVDA still control the server and infrastructure environments, which is where the money really lies
Posted on 3/3/21 at 1:49 pm to UltimaParadox
quote:
I would think there is some worry for sure that AMD is currently overvalued
Trust me, it isn't. Again almost all price targets out there for it are well in excess of what it's currently trading at. They are expected to at least repeat their 4th quarter in Q1 this year which was already a record for them.
There's been shortages for quite a while now, it's not something that's new in the past few months or so, but they still are absolutely killing it.
quote:
AMD is fabless so they are really at the mercy of TSMC.
This is really the only drawback to them, and well, fighting heavyweights like Nvidia and Intel (but doing a great job of it). Intel has their own fab, but it's been an unmitigated disaster for them recently being stuck on 14nm for seemingly ever now.
Nvidia has been stuck relying on Samsung this go around for their new cards.
This post was edited on 3/3/21 at 2:01 pm
Posted on 3/3/21 at 1:55 pm to thunderbird1100
P/FE is pretty in line with it’s average the last couple years. I think AMD is one of the few big tech companies that isn’t at some outrageous valuation. AMZN is another that’s been seemingly left behind by the market the last 6 months or so.
Posted on 3/3/21 at 1:57 pm to thunderbird1100
quote:
Trust me, it isn't. Again almost all price targets out there for it are well in excess of what it's currently trading at.
I wouldn’t put much faith into PT for any stock, fwiw.
Posted on 3/3/21 at 3:35 pm to bluebarracuda
quote:
Intel and NVDA still control the server and infrastructure environments
AMD is gobbling up market share in this space from Intel. I'm pretty sure all of Dell's newest generation of servers use AMD processors instead of Intel.
OP, I think your answer is that most investors view Intel is a sleeping giant with a much cheaper valuation than AMD and Nvidia. They don't see, or care, how far behind Intel really is and that they won't easily regain the market share that they've lost.
It's certainly possible that Intel's tech catches up before it becomes an issue for the stock market, but I kind of doubt that at this point.
Posted on 3/3/21 at 3:40 pm to whitefoot
quote:
AMD is gobbling up market share in this space from Intel
And Intel is still around 90% market share right now
Posted on 3/3/21 at 7:06 pm to bluebarracuda
True. I think that will change heavily as refreshes take place tho. The Epyc server chips from AMD are cray cray
Posted on 3/3/21 at 11:17 pm to bluebarracuda
quote:
And Intel is still around 90% market share right now
Laugh all you want, but it's a big deal when one of the bigger server OEMs has gone exclusively with AMD over Intel. I'm not as up to speed on HPE, but I do know that they at least offer AMD processors in their servers.
I don't think there's any doubt that AMD will continue strengthening it's foothold in the server space. I expect them to greatly expand their market share over the next few years.
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