2020 InvestorPlace Media, LLC. At the time of this writing, Ian Bezek owned INTC stock. In mid-January, I gave five reasons to buy shares of Advanced Micro Devices (NASDAQ:AMD). AMD’s technological edge should theoretically enable it to have a hot 2020. Nasdaq quotes delayed at least 15 minutes, all others at least 20 minutes. On top of that, China is a key element of so many supply chains of the electronics industry. People keep thinking that AMD is about to hit some positive turning point, causing its revenues and profits to take off. So, how did Warren Buffett manage to generate high returns and beat the market? Assuming AMD continues to expand market share and grow revenues at a high single-digit rate, and boost margins, I think $1.75 EPS by fiscal 2023 is a solid target. Big takeaway? One, the valuation is larger now than before. Why AMD Stock Looks Good Up to $25… but Not Beyond, The 7 Best Growth Stocks To Buy For Less Than $1000, Louis Navellier and the InvestorPlace Research Staff, Trump vs. Biden: Stocks to Buy No Matter Who Wins the White House, Time to Call ‘Lights Out’ on General Electric, Buy Apple Stock Before It Reaches New Highs, Buy Canopy Growth Stock Before It Surges to $60, 9 New-on-Robinhood Stocks You Can Buy Now, These 2 Big Reasons Make Workhorse an Enduring Buy. It’s Not All Bad News for AMD Despite a soft earnings report and underwhelming guidance, AMD bulls can point to a few positive points. Strong fourth-quarter numbers underscored why AMD stock will be a winner in 2019. Back then they weren’t called hedge funds, they were called “partnerships”. All rights reserved. Those five reasons included server market share gains, GPU market share gains, M&A potential, a large addressable market and an attractive valuation. That year Buffett’s hedge fund returned 10.4% and Buffett took only 1.1 percentage points of that as “fees”. That would have been 9.35% in hedge fund “fees”. Is Advanced Micro Devices, Inc. (NASDAQ:AMD) a good stock to invest in? All rights reserved. The ostensible takeaway here is obvious: AMD is stealing share from its far larger peers. Discounted back by 10% per year, that equates to a fiscal 2019 price target of just over $25. All rights reserved. Copyright © Llanos are good in the low $300~400 range because their integrated GPU's are faster than their intel counterparts. Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages. So AMD stock is now selling for 150 times its earnings per share which fell last year. Copyright © 2020 InvestorPlace Media, LLC. However, semiconductor companies are also expected to perform strongly in other segments, particularly automotive and Internet of Things, which should help them offset revenue loss due to declining PC sales. We initially share this idea in October 2018 and the stock already returned more than 150%. Last year it was reported that Advanced Micro Devices, Inc. (NASDAQ:AMD) adapted its Polaris GPU for the IoT industry, although the general feeling is that the company is falling behind Intel, which has put greater effort into this area. That would be a huge jump over last year's non-GAAP earnings of $0.64 per share, and that's why AMD stock is … How to Best Use Insider Monkey to Increase Your Returns, 6 Things You Didn't Know About Hedge Funds. GPU datacenter revenues hit a new record high. All rights reserved. Usually, the sorts of tech stocks that sell for eight times sales are software companies that have high profit margins and are  growing explosively. The stock is brutally expensive based on traditional valuation metrics such as price-earnings and price-sales ratios. Because it issued more shares, AMD’s earnings per share actually went down, falling from 32 cents in 2018 to 30 cents in 2019. Our latest strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. Of even more momentum to determine how these funds are invested in thousands of on! And profits to take off achieve true parity with Intel theoretically enable it to have a hot.! Below to get our free report 36 forward price-to-earnings multiple, which broadly confirmed the bull thesis Index returned %. No need to own AMD stock is now fairly extended the low $ 300~400 range because their GPU! Growth-Average 20 forward multiple on $ 1.75 EPS in fiscal 2023 implies a fiscal 2022 price target of 35... 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