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Advanced Micro Devices (AMD) Beats Stock Market Upswing: What Investors Need to Know

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Advanced Micro Devices (AMD - Free Report) closed at $118.58 in the latest trading session, marking a +1.08% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.01%. Meanwhile, the Dow lost 0.22%, and the Nasdaq, a tech-heavy index, added 0.32%.

Shares of the chipmaker witnessed a gain of 18.95% over the previous month, beating the performance of the Computer and Technology sector with its gain of 7.95% and the S&P 500's gain of 5.2%.

Investors will be eagerly watching for the performance of Advanced Micro Devices in its upcoming earnings disclosure. The company's upcoming EPS is projected at $0.60, signifying a 13.04% drop compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $7.41 billion, showing a 27% escalation compared to the year-ago quarter.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $4.02 per share and a revenue of $31.78 billion, indicating changes of +21.45% and +23.24%, respectively, from the former year.

Investors might also notice recent changes to analyst estimates for Advanced Micro Devices. These revisions typically reflect the latest short-term business trends, which can change frequently. 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 take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 11.93% lower. As of now, Advanced Micro Devices holds a Zacks Rank of #3 (Hold).

Looking at valuation, Advanced Micro Devices is presently trading at a Forward P/E ratio of 29.21. For comparison, its industry has an average Forward P/E of 17.85, which means Advanced Micro Devices is trading at a premium to the group.

We can also see that AMD currently has a PEG ratio of 1.19. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As of the close of trade yesterday, the Computer - Integrated Systems industry held an average PEG ratio of 1.89.

The Computer - Integrated Systems industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 43, placing it within the top 18% of over 250 industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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