Is AMD Stock a Good Option for Investors Right Now?

On March 13, Advanced Micro Devices (NYSE:AMD) stock rose 12.5% and closed at $43.90 with a market cap of $51.3 billion. The Dow Jones Industrial Average and the S&P 500 rose 9.36% and 9.29% on the same day, respectively. The broader markets rose due to the possibility that the US government might initiate a fiscal stimulus to protect the economy from the coronavirus outbreak. Read Dow Jones Surges after Paring Trump-Era Returns to learn more.

AMD’s stock price has fallen 9.7% in the trailing five-day period, while it has risen 87.8% in the trailing 12-month period. The stock is trading 25.9% below its 52-week high of $59.27 on February 19. The stock was also trading 90.5% above its 52-week low of $23.04 on March 18, 2019. On a YTD (year-to-date) basis, the stock has fallen by 4.3% as of March 13.

Intel (NASDAQ:INTC) and Nvidia (NASDAQ:NVDA) have gained 0.1% and 42.8%, respectively, in the last 12 months. Qualcomm, Micron (NASDAQ:MU), and Broadcom (NASDAQ:AVGO) have returned 36.9%, 10.7%, and -13.6%, respectively.

Analysts’ recommendations for AMD stock

As of March 13, 39 analysts cover AMD stock. Among the analysts, 17 or ~43.6% of the analysts recommend a “buy” for the stock, 21 or ~53.8% recommend a “hold,” and one or ~2.6% recommend a “sell.”

Analysts have an average target price of $50.34 on AMD. The target price implies a return of 14.7% based on the closing price of $43.90 on March 13. The consensus target price for the stock has risen from $48.59 in February—a rise of 3.6%. The highest target price estimate is $66, while the lowest is $8.00.

Northland Capital Markets analyst Gus Richard upgraded AMD stock to “outperform” from the earlier rating of “market perform.” The analyst increased its target price on the stock from $45 to $52.50. According to a report from TheFly, “While it is difficult to know the ultimate impact of coronavirus, he sees the stock as compelling on a 12 month or longer time frame and calls it one to own post-crisis.”

Earlier this month, Jefferies increased its target price on AMD stock to $60 from $58. Susquehanna and Deutsche Bank raised their target prices for the stock from $50 to $55 and $42 to $50, respectively. Atlantic Equities upgraded AMD stock to “overweight” from “neutral” with a target price of $60. Craig-Hallum upgraded the stock to “buy” from “hold” with a target price of $60. Piper Sandler also raised its target price for the stock from $56 to $58.

Financial performance

In the fourth quarter of 2019, AMD’s revenue of $2.13 billion beat Wall Street analysts’ consensus estimates by 0.9%. The company’s revenue rose 49.9% YoY (year-over-year) in the fourth quarter of 2019. AMD’s adjusted earnings of $0.32 were above analysts’ estimates by 3.2%. However, the company’s earnings rose 300% YoY in the fourth quarter of 2019.

Analysts expect AMD’s revenues to rise by 30.0% in 2020 to $8.7 billion. The sales will likely rise by 20.0% in 2021 to $10.5 billion. The adjusted earnings will likely rise by about 79.7% in 2020 to $1.15 per share. However, the profits could rise by 40.0% YoY to $1.61 per share in 2021.

AMD stock performance

AMD stock closed 9.8% below its 20-day moving average of $48.68 on March 13. However, the stock was 11.0% and 0.5% below its 50-day and 100-day moving averages of $49.35 and $44.11, respectively. AMD’s 14-day MACD is -3.05, which indicates a downward trading pattern. With a 14-day RSI (relative strength index) score of 44, the stock isn’t oversold or overbought.

AMD has an upper Bollinger Band level of $58.86. The company’s middle Bollinger Band level is $48.68, while its lower Bollinger Band level is $38.50. On March 13, AMD stock closed near its middle Bollinger Band level, which also indicates that it isn’t overbought or oversold.

AMD stock is trending downward in today’s pre-market session. The stock fell by 11.7% at 6:25 AM ET. Read AMD Stock Fell Due to Disappointing Guidance and AMD Stock Rises Due to Analyst Upgrade: Will It Continue? to learn more.