AI Play AMD May Be on the Verge of a Breakthrough: Funds - Latest Global News

AI Play AMD May Be on the Verge of a Breakthrough: Funds

modern micro devices (AMD) was one of the first to follow Nvidia into the artificial intelligence market. Things are starting to pay off for Santa Clara-based AMD. The stock rose more than 200% from a low of 54.57 in October 2022 and was trading at around 164 as of Thursday afternoon. Also on Thursday, AMD stock’s Relative Strength (RS) Rating rose to 84 from 80 the day before.

The upgraded 84-RS rating for AMD stock shows the chipmaker’s stock ranks in the top 16% of all stocks in the IBD database. It’s a striking difference. Over 100 years of market history shows that the best stocks typically have an RS Rating of 80 or better when they embark on their biggest runs.


AMD shares are rising. Are you preparing for the outbreak?

Additionally, AMD is leading the artificial intelligence revolution. It competes with Intel (INTC) via microprocessors, the “brains” of computers. And it competes with Nvidia (NVDA) with a graphics processor, the chip technology that servers use to process AI transactions.

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AMD is on a growth path and has good valuations. However, please note that the basics could be improved. Analysts agree that improvement is imminent.

The watchlist contender reported a modest 3% increase in earnings per share to 62 cents in its most recent quarter on 2% higher revenue of $5.47 billion. The consensus forecast calls for a 60% increase in earnings per share this quarter on a 7% increase in revenue and even stronger growth planned later this year.

Meanwhile, among its other key ratings, AMD has a Positive Earnings Per Share Rating of 89 out of 99. Its Composite Rating is a mediocre 78 and its SMR Rating (Sales + Profit Margins + Return on Equity) is a mediocre C A to E scale.

Funds are flowing into this AI game

Because of its just-good fundamentals, AMD stock has a weak E Accumulation/Distribution Rating, a measure of buying by institutional investors. Still, the number of funds tracking AMD stock has risen from 4,060 in September to 4,226 in December as they expect new highs. The number rose to 4,357 in March, according to MarketSurge data.

AMD shares rose on Thursday afternoon. It is more than 5% more than 125.72 in a second tier cup with handle. This means it is now outside of a proper buy zone. Look for the stock to present a new buying opportunity, such as a three-week tight or a pullback to the 50-day or 10-week line.

AMD stock ranks 13th among its peers in the 39-stock Electronics-Semiconductor Fabless industry group. NVIDIA (NVDA), Arm stocks (ARM) and Broadcom (AVGO) are among the five best-rated stocks in the group.

IBD’s proprietary RS Rating measures technical performance by showing how a stock’s price movement over the past 52 weeks compares to the other stocks in our database.


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