AMD: This Is A Value Trap

Summary:

  • Advanced Micro Devices, Inc. shares are flat YTD and are underperforming against Nvidia, which saw its stock appreciate over 100% since the beginning of the year.
  • At the same time, AMD’s stock appears undervalued, with a fair value of $170.63 per share, representing a potential upside of over 15%.
  • However, AMD’s growth is not guaranteed due to the rising challenges, such as increased competition from Nvidia, declining gaming revenues, and potential macroeconomic headwinds.

AMD Ryzen 5 2600 Processor close up in the black motherboard CPU socket. Advanced Micro Devices is an American semiconductor company based in Santa Clara, California

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Despite being one of the main designers of AI GPUs and CPUs across the globe, Advanced Micro Devices, Inc.’s (NASDAQ:AMD) shares have failed to gain momentum recently, even after the company reported decent earnings results


Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Bohdan Kucheriavyi is not a financial/investment advisor, broker, or dealer. He's solely sharing personal experience and opinion; therefore, all strategies, tips, suggestions, and recommendations shared are solely for informational purposes. There are risks associated with investing in securities. Investing in stocks, bonds, options, exchange-traded funds, mutual funds, and money market funds involves the risk of loss. Loss of principal is possible. Some high-risk investments may use leverage, which will accentuate gains & losses. Foreign investing involves special risks, including greater volatility and political, economic, and currency risks and differences in accounting methods. A security’s or a firm’s past investment performance is not a guarantee or predictor of future investment performance.

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