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The Best Options Trade for Advance Micro Devices (AMD) Earnings

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On Thursday, October, 19th, Advance Micro Devices (AMD - Free Report) will release its third quarter earnings results after the bell. The company is a Zacks Rank 2 (Buy), and have a Value, Growth, and Momentum score of B.

Dave will look at AMD’s past earnings, take a look at what is currently going on with the company, and give us his thoughts on their upcoming earnings announcement.

Furthermore, Dave will uncover some potential options trades for investors looking to make a play on AMD ahead of earnings.

AMD in Focus

Advanced Micro Devices, Inc. is a world-class company with the innovation, execution, and vision to grow our leadership position in the industry. Today's world-class companies share three essential characteristics. First, they deliver innovative products and technologies that customers want. Second, they have established a proven track record of fast, efficient manufacturing execution. And third, they have a bold vision of where to take their business, and often their industry. Over the course of AMD's three decades in business, silicon and software have become the steel and plastic of the worldwide digital economy. Technology companies have become global pacesetters, making technical advances at a prodigious rate always driving the industry to deliver more and more, faster and faster. AMD's dedication to customer-centric innovation and competitive spirit is an unbroken thread running from our early days in the integrated circuit business, through an ever-broadening product portfolio.

AMD is expected to report earnings of -$0.01 per share according to the Zacks Consensus Estimate. Last quarter they beat earnings expectations by 36.36% at -$0.07 per share, beating estimates of -$0.11 per share.

ADV MICRO DEV Price, Consensus and EPS Surprise

ADV MICRO DEV Price, Consensus and EPS Surprise | ADV MICRO DEV Quote

AMD is trading around $6.65 a share, and they are near to their 52-week high of $8.00 per share, and they have an average earnings miss of 3.83%.

AMD is tied to the electronic computer-semiconductor industry, and their industry is in the top 11%. Having said that, AMD went through a rough patch the last few years. Their 52-week low was a $1.75, and historically they had a streak of earnings misses from mid-2014 through early 2016. Furthermore, AMD faces tough competition against Intel (INTC - Free Report) and Nvidia (NVDA - Free Report) .

Intel has a larger market share and presence for their processors unlike AMD, but AMD is a cheaper alternative to Intel which appeals to some users. Meanwhile Nvidia is a much more common GPU for PC gamers than AMD; however, AMD has reported momentum as of late by taking away some of Nvidia’s market share. Furthermore, AMD’s earnings estimates have been revised positively recently. Overall AMD seems to be heading in a positive direction; however, never underestimate their competitors from staying ahead of them.

Bottom Line

How should investors play AMD ahead of their earnings report? For insights on the best options trades, make sure you are subscribe to Live Trader to see Dave Bartosiak at 1:00 pm on Wednesday.

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