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Advanced Micro Devices (AMD) Gains As Market Dips: What You Should Know
In the latest trading session, Advanced Micro Devices (AMD - Free Report) closed at $97.84, marking a +1.28% move from the previous day. This move outpaced the S&P 500's daily loss of 1.1%. At the same time, the Dow lost 1.19%, and the tech-heavy Nasdaq lost 3.27%.
Prior to today's trading, shares of the chipmaker had gained 20.63% over the past month. This has outpaced the Computer and Technology sector's gain of 1.45% and the S&P 500's loss of 3.02% in that time.
Investors will be hoping for strength from Advanced Micro Devices as it approaches its next earnings release. On that day, Advanced Micro Devices is projected to report earnings of $0.56 per share, which would represent a year-over-year decline of 50.44%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.3 billion, down 9.89% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.01 per share and revenue of $23.52 billion. These totals would mark changes of -14% and -0.35%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for Advanced Micro Devices. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.39% higher. Advanced Micro Devices is currently a Zacks Rank #5 (Strong Sell).
In terms of valuation, Advanced Micro Devices is currently trading at a Forward P/E ratio of 32.09. This represents a premium compared to its industry's average Forward P/E of 18.99.
Investors should also note that AMD has a PEG ratio of 4.68 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Electronics - Semiconductors stocks are, on average, holding a PEG ratio of 3.24 based on yesterday's closing prices.
The Electronics - Semiconductors industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 147, putting it in the bottom 42% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow AMD in the coming trading sessions, be sure to utilize Zacks.com.