Advanced Micro Devices (NASDAQ:AMD) Reaches New 52-Week Low - Should You Sell?

Advanced Micro Devices, Inc. (NASDAQ:AMD) recently hit a new 52-week low during mid-day trading on Thursday, reaching as low as $120.43. The stock was last seen trading at $121.41, with a significant trading volume of 49,394,848 shares. Just the previous day, the stock had closed at $125.02.

Analyst Outlook for AMD

Despite the decline, Wall Street analysts remain optimistic about AMD's growth potential. Various research reports have been published regarding the stock. For instance, on October 11th, Roth MKM reiterated a "buy" rating and set a target price of $200.00. Cantor Fitzgerald also maintained an "overweight" rating with a price objective of $180.00 on October 30th. Additionally, UBS Group lowered its price target from $210.00 to $205.00 while keeping a "buy" rating. Evercore ISI increased its target price from $193.00 to $198.00 and gave AMD an "outperform" rating on the same date. Mizuho reduced its target price from $185.00 to $180.00 and also rated the stock as "outperform" on December 5th.

Out of all analysts, one issued a sell rating, four gave a hold rating, twenty-six issued buy ratings, and one assigned a strong buy rating. According to MarketBeat.com, the consensus rating for AMD is "Moderate Buy" with an average target price of $192.36.

AMD's Financial Overview

Advanced Micro Devices has a market capitalization of approximately $197.02 billion, with a price-to-earnings ratio of 109.38 and a PEG ratio of 1.88. Its beta is 1.65, reflecting its volatility compared to the broader market. The company reported a current ratio of 2.50 and a quick ratio of 1.78, showcasing its ability to meet short-term liabilities. Further, its debt-to-equity ratio stands at a low 0.03, indicating minimal debt.

On October 29th, AMD released its latest earnings results, reporting earnings per share (EPS) of $0.92, aligning with analysts' expectations. The company experienced a return on equity of 6.62% and a net margin of 7.52%. For the quarter, it achieved revenues of $6.82 billion, surpassing the forecast of $6.71 billion and demonstrating a year-over-year revenue increase of 17.6%. Analysts predict AMD will post an EPS of 2.54 for the current year.

Insider Trading Activity

In recent news, AMD's CEO, Lisa T. Su, sold 80,000 shares on November 6th, with an average selling price of $143.87, totaling around $11.51 million. After the sale, she retains 3,566,762 shares valued at approximately $513.15 million. This sale reflects a decrease of 2.19% in her holdings. Additionally, Executive Vice President Forrest Eugene Norrod sold 40,540 shares on November 5th for approximately $5.74 million, reducing his stake by 12.14%. In the last 90 days, insiders have collectively sold 197,036 shares valued at about $28.17 million. The total insider ownership currently stands at 0.73% of the company’s stock.

Institutional Investor Activity

Regarding institutional investments, Charles Schwab Investment Management Inc. increased its stake in AMD by 1.9% during the third quarter, holding 9,656,965 shares now valued at $1.58 billion. Similarly, the Swiss National Bank's position grew by 0.3%, owning 4,797,575 shares valued at $787.19 million. Other firms, like Shum Financial Group Inc. and Geode Capital Management LLC, have also adjusted their positions in AMD, with institutional investors collectively controlling 71.34% of the company's shares.

About AMD

Advanced Micro Devices, Inc. operates globally as a semiconductor company. It has multiple segments, including Data Center, Client, Gaming, and Embedded, and offers a variety of products such as x86 microprocessors, graphics processing units (GPUs), chipsets, and embedded processors.

Conclusion

As AMD shares reach new lows, investors pondering whether to sell should consider the analysis and distinct insights available from various financial experts. While market conditions may appear challenging, the long-term growth projections from analysts present a different narrative.

AMD, Stocks, Market