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Investing.com - Goldman Sachs has reiterated its Neutral rating and $210.00 price target on AMD (NASDAQ:AMD) following the chipmaker’s quarterly results that exceeded expectations. The stock currently trades at $250.11, near its 52-week high of $267.08, with a P/E ratio of 151.2 - significantly above what InvestingPro analysis suggests is its Fair Value, placing AMD among overvalued semiconductor stocks.
AMD reported revenue of $9.2 billion, surpassing both Goldman Sachs’ estimate of $8.92 billion and the Street’s projection of $8.76 billion. The company’s operating earnings per share came in at $1.20, slightly below Goldman Sachs’ forecast of $1.23 but in line with consensus estimates of $1.19.
The chipmaker’s strong performance was primarily driven by its Datacenter segment, which posted revenue of $4.34 billion, and Gaming segment, which generated $1.30 billion in revenue, significantly exceeding expectations. However, the Embedded segment underperformed with revenue of $857 million, falling short of estimates.
For the fourth quarter, AMD provided guidance above Street expectations, projecting revenue of approximately $9.60 billion at the midpoint and a non-GAAP gross margin of 54.5%. This revenue forecast exceeds both Goldman Sachs’ estimate of $9.20 billion and the Street’s projection of $9.17 billion.
Goldman Sachs maintains that AMD stock may remain range-bound despite the beat-and-raise quarter, citing elevated investor expectations following the company’s recent partnership announcement with OpenAI and ahead of its upcoming Analyst Day on November 11. With revenue growth of 27.17% and RSI indicating overbought conditions, investors seeking deeper insights can access AMD’s comprehensive Pro Research Report on InvestingPro, which offers 20+ additional ProTips and extensive financial metrics.
In other recent news, AMD has announced its involvement in a significant project at Oak Ridge National Laboratory, where it will provide technology for two new supercomputers as part of a $1 billion investment in artificial intelligence and high-performance computing. Additionally, AMD has finalized the divestiture of ZT Systems’ data center infrastructure manufacturing business to Sanmina, establishing a strategic partnership with Sanmina as a preferred manufacturing partner for cloud and AI solutions. UBS has maintained its Buy rating on AMD with a price target of $265, citing potential upside in the company’s third-quarter results, particularly in the server and client CPU segments.
Meanwhile, Qualcomm has received a reiterated Buy rating from Rosenblatt, with a price target of $225 following its 200MW deployment deal with HUMAIN. Rosenblatt views this development as a positive step for Qualcomm, aligning with its strategy to diversify end markets and grow its smartphone market share. These developments highlight ongoing strategic moves by both AMD and Qualcomm in their respective fields.
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