Advanced Micro Devices (NASDAQ: AMD) has been a constant subject of study for tech industry watchers. There are more than 500 stocks in the still burgeoning technology sector. Many if not most of these stocks have given good returns over the last year or so. And AMD has doubled as well. But its price band of $6 to $15 is no where near its hey days value when the stock used to play above $40 and even touched $90 once.
If you look closely, AMD has been quite cyclical. Perhaps moreso than a lot of other stocks. It hovered in the $20s and then spiked to $65 in 1983 and 17 years later it hovered in the $30s and #40s before shooting up to $92 in year 2000. It’s fallen off the cliff pretty much every time it has shot up. In 17 years since it last spiked, AMD has hovered around the $10 mark, once falling as low as $1.67.
But is it time for another spike? Or has the market changed too much now?
The advent of the crypto boom has given a new, not entirely expected, fillip to AMD. The GPU wars are a real thing and AMD’s GPU capabilities seem to be in the spotlight. Of course it has NVIDIA (NASDAQ: NVDA) to contend with but as far as stocks go, there’s constant chatter about NVDA being over-priced at $187.
AMD, therefore, has perhaps only itself blame – negative net income, negative EBITDA. Much as people might want to invest in a theme (crypto and GPU power, in this case) or a product (AMD’s Vega cards are getting good feedback) or a potential business growth (Amazon’s deal), if the fundamentals are not strong over a long period of time, there’s only so much faith one can have in the business.
But for the risk-taker in you, could AMD be an opportunity? Well, that’s something to think about!
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