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Analysis of AMD company  (#AMD)

Analysis of AMD company (#AMD)

5 May 2021

AMD is an American manufacturer of integrated microcircuit electronics, one of the largest manufacturers of central processing units, graphics processors and adapters, motherboards and chipsets for them, also supplies RAM and solid-state drives under the Radeon brand. Since 2009, it does not have its own microelectronic production and places orders at the facilities of other companies. It has been using GlobalFoundries as a permanent partner-manufacturing contractor for the production of its chips, and since 2018 it has been using TSMC.

The main competitors of the company are Intel and NVIDIA.

2020 Revenue: $ 9.8B (+ 45% YoY)

2020 operating income: $ 1.4B (+ 117% yoy)

2020 net income: $ 2.5B (+ 630% yoy)

Earnings per share last quarter: $ 0.52, above $ 0.44 forecast

Failure with 7nm processor of competitors significantly strengthened the company’s position in the market

Geographic distribution of revenue:

China – 25.74%

United States – 25.36%

Taiwan – 13.12%

Europe – 12.25%

Singapore – 12.11%

Japan – 11.42%

AMD has significantly strengthened its position in the market due to Intel’s unsuccessful launch of its 7nm processors, the release of which the company has postponed for 3 years. It should be noted that AMD already manufactures products on this type of processors. Therefore, the company’s prospects in the market are quite high. After all, it is now the leading processor manufacturer in the world. Despite this, many consumers still prefer Intel products because they are more familiar with it. However, this factor can soon be eliminated, with a competent approach to advertising.

Thus, AMD has recently become a leading company in the production of processors for desktop and laptops. The market is promising and developing. That is, the company can increase its revenue and net profit several times over several years. Despite the fact that the quotes of the company’s shares are now higher than the fair value, it is definitely worth buying the securities

Despite the improvement in performance, AMD can safely go down to 58 from the current 80, while still being in the buying zone. There is probably no point in buying at this level. You should wait for the 58 zone and take from this level, focusing on the repetition of the highs at the 100 levels.

5 May 2021
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