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Advanced Micro Devices Hits 52-Week High on Firm Q2 View
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Shares of Advanced Micro Devices (AMD - Free Report) hit a new 52-week high of $4.20 on May 23, eventually closing at $4.04. The company returned 82.0% in the past one-year period and has added approximately 40.8% year to date. Average volume of shares traded over the last three months was roughly 17,313K.
What is Driving Advanced Micro?
AMD is the second-largest producer of microprocessors, GPUs and chipsets in the world. Strength in graphics, growing semi-custom business, solid datacenter offerings, better utilization of resources and solid embedded business are the major positives for the company.
The price appreciation can be attributed to AMD’s strong fundamentals, better-than-expected first-quarter 2016 results reported on Apr 21 and strong guidance for the upcoming quarter.In response, the stock has gained 54.0%.
In the first quarter, AMD’s revenues of $832 million came above the Zacks Consensus Estimate. Also gross margin of 32.3% was up 279 basis points (bps) sequentially and 68 bps year over year, driven by an improved product mix between business segments.
Moreover, the company provided a solid guidance for the upcoming quarter. Revenues are expected to increase 15% sequentially (+/- 3%) on an expectation of higher demand for graphic chips, strong demand for game consoles and the ramp up of the previously announced new business in the second half of 2016. Also, management believes that AMD's datacenter offerings will result in new design wins that will likely deliver strong revenue growth in 2017 and beyond.
Moreover, the company is strengthening its position in key markets with the introduction of several APUs and GPUs. Its Radeon Technologies Group focuses on the graphics business and is improving its performance in traditional graphics markets. At the same time, the company is taking initiatives in immersive computing markets like virtual and augmented reality.
Additionally, AMD delivered a positive earnings surprise of 6.67% in the first quarter. The Zacks Rank #3 (Hold) company’s solid market position in chip market, increasing share in the fastest growing data center server market, introduction of new products, continued innovation and strong long-term growth potential position it well.
Stocks to Consider
Some better-placed stocks in the technology space include TiVo Inc. , Netgear Inc. (NTGR - Free Report) and Radcom Ltd. (RDCM - Free Report) , each sporting a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>
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Advanced Micro Devices Hits 52-Week High on Firm Q2 View
Shares of Advanced Micro Devices (AMD - Free Report) hit a new 52-week high of $4.20 on May 23, eventually closing at $4.04. The company returned 82.0% in the past one-year period and has added approximately 40.8% year to date. Average volume of shares traded over the last three months was roughly 17,313K.
What is Driving Advanced Micro?
AMD is the second-largest producer of microprocessors, GPUs and chipsets in the world. Strength in graphics, growing semi-custom business, solid datacenter offerings, better utilization of resources and solid embedded business are the major positives for the company.
The price appreciation can be attributed to AMD’s strong fundamentals, better-than-expected first-quarter 2016 results reported on Apr 21 and strong guidance for the upcoming quarter.In response, the stock has gained 54.0%.
In the first quarter, AMD’s revenues of $832 million came above the Zacks Consensus Estimate. Also gross margin of 32.3% was up 279 basis points (bps) sequentially and 68 bps year over year, driven by an improved product mix between business segments.
Moreover, the company provided a solid guidance for the upcoming quarter. Revenues are expected to increase 15% sequentially (+/- 3%) on an expectation of higher demand for graphic chips, strong demand for game consoles and the ramp up of the previously announced new business in the second half of 2016. Also, management believes that AMD's datacenter offerings will result in new design wins that will likely deliver strong revenue growth in 2017 and beyond.
Moreover, the company is strengthening its position in key markets with the introduction of several APUs and GPUs. Its Radeon Technologies Group focuses on the graphics business and is improving its performance in traditional graphics markets. At the same time, the company is taking initiatives in immersive computing markets like virtual and augmented reality.
Additionally, AMD delivered a positive earnings surprise of 6.67% in the first quarter. The Zacks Rank #3 (Hold) company’s solid market position in chip market, increasing share in the fastest growing data center server market, introduction of new products, continued innovation and strong long-term growth potential position it well.
Stocks to Consider
Some better-placed stocks in the technology space include TiVo Inc. , Netgear Inc. (NTGR - Free Report) and Radcom Ltd. (RDCM - Free Report) , each sporting a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>