Advanced Micro Devices (NASDAQ:AMD) is in a sustained downtrend after the stock peaked following the annual Computer Electronics Show 2021. Investors who did not own the stock in the teens should not start a position from here. Valuations remain a headwind for AMD stock.
Last week, AMD announced the 5000G-series product. The integrated graphics is a necessary release. The company cannot afford to lose market share to Intel.
AMD’s 5000G series is a follow-up to the 4000G series. Based on the Zen 3 architecture, the IGP is Vega 8-based. At a 4Ghz base clock speed, the chip has a TDP of only 35 watts. The chip will suit budget consumers who want light gaming capabilities for 3D titles.
AMD claims the chip will run up to 80% faster than Intel’s i7-10700.
Ahead of its earnings report, Intel cannot afford to have its competitor launching more products that perform better and cost less. Intel is still behind in its next-generation chip. The delays are undermining investor confidence.
For now, both AMD and INTC stock benefit from a chip shortage. Eventually, the sector will increase capacity and create a glut in chips. Neither stock is worth chasing at this time.
AMD is a long-term winner for current shareholders. Those who missed most of the rally should look elsewhere.
