IIn the last trading session, Advanced Micro Devices (AMD) closed at $81.57, marking a -0.59% move from the previous day. This change lagged the S&P 500’s 0.22% gain on the day. Meanwhile, the Dow Jones lost 0.13% and the tech-heavy Nasdaq gained 0.22%.
Prior to today’s trading, shares of the chipmaker had lost 12.76% over the past month. This was lower than the IT & Technology sector’s 9.55% loss and the S&P 500’s 10.02% loss during this period.
Investors are hoping for strength from Advanced Micro Devices as it nears its next earnings release. In this report, analysts expect Advanced Micro Devices to post earnings of $1.03 per share. This would mark a year-over-year growth of 63.49%. Meanwhile, Zacks’ consensus estimate for revenue calls for net sales of $6.52 billion, up 69.29% from the year-ago period.
AMD’s full-year Zacks consensus estimates call for earnings of $4.37 per share and revenue of $26.36 billion. These results would represent year-over-year variations of +56.63% and +60.4%, respectively.
Investors might also notice recent changes in analyst estimates for Advanced Micro Devices. These revisions generally reflect the latest short-term trading trends, which may change frequently. Therefore, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Our research shows that these estimate changes are directly correlated to short-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model that takes into account these estimation changes and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system is proven and externally audited for outperformance, with #1 stocks returning an average of +25 % per year since 1988. The Zacks Consensus EPS estimate rose 0.79% over the past month. Advanced Micro Devices currently sports a Zacks rank of #3 (Hold).
Given its valuation, Advanced Micro Devices has a Forward P/E ratio of 18.65. This valuation marks a premium compared to the average Forward P/E of its sector of 14.33.
Investors should also note that AMD currently has a PEG ratio of 0.57. This measure is used in the same way as the famous P/E ratio, but the PEG ratio also takes into account the growth rate of the stock’s expected earnings. AMD’s industry had an average PEG ratio of 1.63 at yesterday’s close.
The Electronics – Semiconductors industry is part of the Computer and Technology sector. This group has a Zacks industry ranking of 84, which places it in the top 34% of over 250 industries.
The Zacks Industry Ranking assesses the strength of our industry groups by measuring the average Zacks Ranking of individual stocks within the groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and more, at Zacks.com.
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