AMD (advanced Micro Devices Inc.) had faded into obscurity until a couple of years ago when it came out with its RYZEN series of processors which were an instant hit. Under the leadership of CEO Lisa Su, AMD has not only risen to match Intel, but surpass it in some instances. If analysts were to be believed, AMD was supposed to go bankrupt by now.
Instead we see that AMD’s stock has reached an all time high. This is in stark contrast with what the skeptics estimated for 2020. With profits peaking in February and recouping an almost 40% growth in y-o-y after a pandemic caused decline.
Cherished CEO Dr. Lisa Su had this to say, “We executed well in the first quarter, navigating the challenging environment to deliver 40% year-over-year revenue growth and significant gross margin expansion driven by our Ryzen and EPYC processors” she added, “while we expect some uncertainty in the near term demand environment, our financial foundation is solid and out strong product portfolio positions us well across a diverse set of resilient end markets”.
And that is exactly why you should consider taking AMD seriously at this point. With Wall Street’s eyes on this lucrative tech stock consensus has now rated the chip stock as a ‘Moderate Buy’, with a 12 ‘Buy’ and a 9 ‘Hold’ recommendation. Indians should keep AMD’s value driven market approach under radar as talks of opening up a factory in the western state of Gujarat
Even in the Indian market AMD has taken lucrative market share from its rivals. For instance, repeated delays in Intel‘s server platform and other projects which got stalled due to the global lockdown situation has allowed the relatively smaller chip fabricator to scoop up a healthy market share of CPU sales as well as GPU sales as evidenced by declining b2b sales of NVidia Corp. in favour of AMD’s Sapphire based GPU architecture.
AMD’s technical data suggests a profitable margin for early investors which emanates from the price targets which range from a tank of $ 33 to a peak of $ 70 as the stocks are currently trading more than $ 7 under the median target of $ 57.50. This coupled with the February rally indicates that the price action has completed the handle in the bullish cup and handle pattern that forecasts an incredibly profitable breakout with models predicting figures in the lower 80s which hints at an astounding 35%-40% return from current investment scenarios.
All things considered, AMD is the underdog which has proved it’s value in gold with strong market presence and a no-nonsense attitude for business practices. With regards to it’s stock situation, whatever happens remains to be seen.