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AMD stock has been tanking (down 10% in pre-market today). Any opportunities here?

(Tanking bit strong... down from a recent high of 4.50 not long ago)




They just announced their financials, which is probably why it has been dropping.

Of course, the financials matched the projections, but the stock market is funny.


I feel like they have a strong portfolio going forward, though. Diversifying into ARM, Southern Islands is behind the door conquering the consumer compute space, focus on heterogeneous compute.

They are only in trouble in the spaces where their x86 processors have to compete with Intel. They don't have their own fabs anymore, they aren't a die node ahead like Intel, and they are also just in terms of raw revenue an order of magnitude smaller than Intel. That isn't a fight to win, and they have been stuck in this low-cost no-margins commodity cpu space for a while.


They are definitely a potential opportunity. To my understanding, many analysts are disturbed by falling gross margin, because in the Intel space high gross margin is important. But, according to some articles I've read, lower gross margin is a natural part of the semi-custom sort of work the company is doing now, like the Xbox & Playstation chips.

An article that explains the shift:

http://www.fool.com/investing/general/2013/12/30/can-amds-se... ("Semi-custom could be the answer")

So, depending on what you believe, the future of the stock could be rather undervalued.


if AMD gets back to 2.50, then it's a strong buy. today's drop is just back to where it was a month ago.


This seems right.




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