wells-fargo-slashes-amd’s-price-target-by-7%:-find-out-why

Wells Fargo Slashes AMD’s Price Target By 7%: Find Out Why

  • Wells Fargo analyst Aaron Rakers maintained Advanced Micro Devices, Inc (NASDAQ: AMDwith an Overweight and cut the price target from $140 to $130.

  • Rakers was positive on AMD’s ability to continue gaining share in the server and PC CPU markets, increasing traction in datacenter GPUs, positive, accelerating incremental operating leverage, and ultimately earnings power above $6/share by 2025.

  • A positive early-June Analyst Day, which he believed reaffirmed confidence in AMD’s product roadmap/continued share gain thesis. He thought the valuation compression in shares of AMD has been primarily reflective of an expectation of downward estimate revisions amid increasing macro concerns.

  • Even with factored-in estimate reductions, Rakers thinks renewed sentiment in AMD’s share gain story can drive AMD shares to return to a +25x forward price to earnings multiple.

  • He reminded AMD would begin reporting new operating segments starting with 2Q22 results, providing investors with greater insight into the company’s growth drivers.

  • The segments included Client (PC) CPUs, Data Center – Server CPUs, Data Center GPUs, FPGAs, and adaptive SoCs, Gaming – GPUs + Game Console SoCs, and Embedded.

  • Price Action: AMD shares traded higher by 5.59% at $85.98 on the last check Tuesday.

  • Photo by cebbi from Pixabay

Latest Ratings for AMD

Date

Firm

Action

From

To

Feb 2022

Bernstein

Upgrades

Market Perform

Outperform

Feb 2022

Daiwa Capital

Upgrades

Outperform

Buy

Feb 2022

Mizuho

Maintains

Buy

View More Analyst Ratings for AMD

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