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Top Stock Picks for Week of March 7, 2022

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Advanced Micro Devices (AMD - Free Report) has strengthened its position in the semiconductor market on the back of its evolution as an enterprise-focus company from a pure-bred consumer-PC chip provider. Advanced Micro Devices is riding on robust performance from the Computing and Graphics, and Enterprise Embedded and Semi-Custom segments as reflected by the fourth-quarter 2021 results. It is benefiting from strong sales of its Ryzen and EPYC server processors, owing to increasing proliferation of AI and Machine Learning (ML) in industries like cloud, gaming and supercomputing domain. Growing clout of 7 nanometer (nm) products in the data center vertical, driven by work-from-home and online learning trends, is a key catalyst. Recently, its third-generation EPYC processors have been selected by Google Cloud to power new C2D instances for high-performance memory-bound workloads. This remains a positive factor for AMD. AMD provided strong 2022 guidance for revenues on the back of robust growth across all businesses. Management execution has been good amid testing times in the wake of the coronavirus pandemic. The long-term earnings growth rate for the stock is currently projected in the double digit percentage.

ExxonMobil (XOM - Free Report) has bellwether status in the energy space, optimal integrated capital structure that has historically produced industry-leading returns and management's track record of capex discipline across the commodity price cycle make it a relatively lower-risk energy sector play. Recently, the company made two new oil discoveries in the Stabroek Block, which will add to its 10 billion oil-equivalent barrels of recoverable resources. It also has a strong presence in the prolific Permian Basin, where it continues to lower its fracking & drilling costs. The company increased its quarterly dividend to 88 cents per share. Notably, the company reported strong fourth-quarter results owing to improved realized oil and gas prices as well as higher refining and chemical margins. Also, it has significantly lower debt exposure as compared to other integrated majors. Consequently, ExxonMobil is viewed as a preferred energy firm to own now.


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