What Our Analysts Know About Advanced Micro Devices

Now trading at a price of $105.23, Advanced Micro Devices has moved -3.3% so far today.

Advanced Micro Devices returned gains of 88.0% last year, with its stock price reaching a high of $132.83 and a low of $55.71. Over the same period, the stock outperformed the S&P 500 index by 66.0%. More recently, the company's 50-day average price was $105.78. Advanced Micro Devices, Inc. operates as a semiconductor company worldwide. Based in Santa Clara, CA, the large-cap Technology company has 25,000 full time employees. Advanced Micro Devices has not offered a dividend during the last year.

The Company Has a Positive Net Current Asset Value:

2018-02-27 2019-02-08 2020-02-04 2021-01-29 2022-02-03 2023-02-27
Revenue (MM) $5,253 $6,475 $6,731 $9,763 $16,434 $23,601
Gross Margins 34.0% 38.0% 43.0% 45.0% 48.0% 45.0%
Operating Margins 1% 7% 8% 14% 22% 5%
Net Margins -1.0% 5.0% 5.0% 26.0% 19.0% 6.0%
Net Income (MM) -$33 $337 $341 $2,490 $3,162 $1,320
Net Interest Expense (MM) -$126 -$121 -$94 -$47 -$34 -$88
Depreciation & Amort. (MM) -$144 -$170 -$222 -$312 -$407 -$4,174
Earnings Per Share -$0.03 $0.32 $0.3 $2.06 $2.57 $0.84
EPS Growth n/a 1166.67% -6.25% 586.67% 24.76% -67.32%
Diluted Shares (MM) 1,039 1,064 1,120 1,207 1,230 1,571
Free Cash Flow (MM) $125 $197 $710 $1,365 $3,822 $4,015
Capital Expenditures (MM) -$113 -$163 -$217 -$294 -$301 -$450
Net Current Assets (MM) -$322 $250 $1,396 $3,018 $3,661 $2,189
Long Term Debt (MM) $1,325 $1,114 $486 $330 $1 $2,467

Advanced Micro Devices has exceptional EPS growth, a pattern of improving cash flows, and an excellent current ratio. However, the firm suffers from slimmer gross margins than its peers and weak operating margins with a positive growth rate. Finally, we note that Advanced Micro Devices has weak revenue growth and a flat capital expenditure trend and an average amount of debt.

Advanced Micro Devices does not have a meaningful trailing P/E ratio since its earnings per share are currently in the red. Based on its EPS guidance of $4.16, the company has a forward P/E ratio of 25.4. In comparison, the average P/E ratio for the Technology sector is 27.16. On the other hand, the market is undervaluing Advanced Micro Devices in terms of its equity because its P/B ratio is 3.08. In comparison, the sector average is 6.23. In conclusion, Advanced Micro Devices's impressive cash flow trend, decent P/B ratio, and reasonable use of leverage demonstrate that the company may still be fairly valued — despite its elevated earnings multiple.

Advanced Micro Devices Has an Average Rating of Buy:

The 38 analysts following Advanced Micro Devices have set target prices ranging from $60.0 to $200.0 per share, for an average of $137.03 with a buy rating. As of April 2023, the company is trading -22.8% away from its average target price, indicating that there is an analyst consensus of strong upside potential.

Advanced Micro Devices has a very low short interest because 1.8% of the company's shares are sold short. Institutions own 74.5% of the company's shares, and the insider ownership rate stands at 0.48%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 9% stake in the company is worth $14,617,268,813.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.