In the latest trading session, Advanced Micro Devices (AMD – Free Report) closed at $82.15, marking a -1.04% move from the previous day. This change lagged the S&P 500’s 0.36% gain on the day.
Prior to today’s trading, shares of the chipmaker had lost 4.94% over the past month. This has lagged the Computer and Technology sector’s gain of 9.06% and the S&P 500’s gain of 5.21% in that time.
Wall Street will be looking for positivity from AMD as it approaches its next earnings report date. In that report, analysts expect AMD to post earnings of $0.44 per share. This would mark year-over-year growth of 144.44%. Meanwhile, our latest consensus estimate is calling for revenue of $3.21 billion, up 79.48% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.93 per share and revenue of $13.47 billion. These totals would mark changes of +49.61% and +37.96%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for AMD. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. AMD is currently a Zacks Rank #2 (Buy).
Valuation is also important, so investors should note that AMD has a Forward P/E ratio of 40.7 right now. This represents a premium compared to its industry’s average Forward P/E of 20.92.
We can also see that AMD currently has a PEG ratio of 1.29. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. The Electronics – Semiconductors was holding an average PEG ratio of 1.87 at yesterday’s closing price.
The Electronics – Semiconductors industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 109, which puts it in the top 43% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.