Are Smart Investors Making the Right Decision? Advanced Micro Devices Inc. (AMD)

Advanced Micro Devices Inc. (NASDAQ: AMD) stock jumped 0.14% on Wednesday to $108.27 against a previous-day closing price of $108.12. With 65.91 million shares changed hands, the volume of the stock remained heavier than its average volume of 64.8 million shares. During the session, the Semiconductors company that operates in wider Technology sector, reached to the highest price of $108.91 whereas the lowest price it dropped to was $105.66. The 52-week range on AMD shows that it touched its highest point at $110.99 and its lowest point at $54.57 during that stretch. It currently has a 1-year price target of $102.37. Beta for the stock currently stands at 1.89.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of AMD was up-trending over the past week, with a rise of 4.36%, but this was up by 29.20% over a month. Three-month performance surged to 35.76% while six-month performance rose 49.42%. The stock gained 13.88% in the past year, while it has gained 67.16% so far this year. A look at the trailing 12-month EPS for AMD yields 0.24 with Next year EPS estimates of 4.08. For the next quarter, that number is 0.57. This implies an EPS growth rate of -67.30% for this year and 44.35% for next year. EPS is expected to grow by 7.61% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 21.90%.

Float and Shares Shorts:

At present, 1.61 billion AMD shares are outstanding with a float of 1.61 billion shares on hand for trading. On Apr 27, 2023, short shares totaled 27.72 million, which was 1.72% higher than short shares on Mar 30, 2023. In addition to Dr. Lisa T. Su Ph.D. as the firm’s Chair & CEO, Mr. Victor Peng serves as its Pres.

Institutional Ownership:

Through their ownership of 73.25% of AMD’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 5.63% of AMD, in contrast to 41.58% held by mutual funds. Shares owned by individuals account for 31.04%. As the largest shareholder in AMD with 8.12% of the stake, The Vanguard Group, Inc. holds 130,846,526 shares worth 130,846,526. A second-largest stockholder of AMD, BlackRock Fund Advisors, holds 76,895,126 shares, controlling over 4.77% of the firm’s shares. SSgA Funds Management, Inc. is the third largest shareholder in AMD, holding 65,045,249 shares or 4.04% stake. With a 3.11% stake in AMD, the Vanguard Total Stock Market ETF is the largest stakeholder. A total of 50,104,923 shares are owned by the mutual fund manager. The Vanguard 500 Index Fund, which owns about 2.35% of AMD stock, is the second-largest Mutual Fund holder. It holds 37,844,677 shares valued at 3.38 billion. Invesco QQQ Trust holds 1.33% of the stake in AMD, owning 21,364,384 shares worth 1.91 billion.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Mar 31, 2023, AMD reported revenue of $6.55B and operating income of $526.00M. The EBITDA in the recently reported quarter was $1.14B and diluted EPS was $0.27.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for AMD since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With AMD analysts setting a high price target of $200.00 and a low target of $77.00, the average target price over the next 12 months is $105.70. Based on these targets, AMD could surge 84.72% to reach the target high and fall by -28.88% to reach the target low. Reaching the average price target will result in a decline of -2.37% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Summary of Insider Activity:

Insiders traded AMD stock several times over the past three months with 7 Buys and 11 Sells. In these transactions, 151,907 shares were bought while 144,539 shares were sold. The number of buy transactions has increased to 38 while that of sell transactions has risen to 57 over the past year. The total number of shares bought during that period was 3,737,581 while 2,083,055 shares were sold.

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