Shares of Advanced Micro Devices (NASDAQ:AMD) likely peaked at $30 in April. The rally ahead of the earnings report priced in the company’s strong results. Now, the waiting begins until the next earnings report. AMD’s presence at Computex could also give the stock a small lift but not enough to send the stock back to $30.
Investors are waiting on the Zen CPU refresh to lead to market share gains for 2019. With six more months to go in the year, AMD need not rush to take Intel’s (NASDAQ:INTC) business. Its technology, from performance to low power consumption to pricing, are all ahead of Intel’s best offerings. Intel also delayed its 10nm CPUs and now expects its availability at the end of the year. This will give AMD plenty of time to win Intel’s customers.
AMD’s GPU refresh in the mainstream gaming market is still absent. Launching Navi at Computex would give the stock a much-needed boost. For now, the stock’s valuation is ahead of its current fundamentals. At a 27 times forward P/E, AMD has only EPYC in the enterprise space to justify the high multiples. Its high-end GPU, with Radeon 7, has limited sales.
In the next month, AMD may trade in a range at between $24 - $28. The market’s five-week downtrend could hurt AMD stock, creating an entry point for investors.
