AMD (NASDAQ: AMD) Shares Soar as Goldman Sachs Adds the Chipmaker To Its Conviction List on the Back of "Multi-Year Share Gain and Margin Expansion Story"
AMD (NASDAQ:AMD) shares are up nearly 5 percentage in today'southward pre-market place trading session as Goldman Sachs (NYSE:GS) opted to include the chipmaker in its coveted 'Conviction Buy' listing.
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While noting a 17 percent pullback from recent highs and the attendant bonny valuation currently, Goldman Sachs analyst Toshiya Hari upgraded AMD shares from a 'Neutral' to a 'Buy' designation while too raising the stock toll target from $84 to $96.
The Goldman analyst termed AMD a "multi-year share gain and margin expansion story". Moreover, Hari cited contempo checks, which point toward strong H1 2021 PC fundamentals, in guild to predict "pattern win/share proceeds momentum in the client and commercial PC space" for AMD.
Acquit in mind that Lenovo's contempo earnings have lent credence to the expectations of a sustained nail in the PC market place. To wit, Lenovo now expects growth in the PC industry's Total Addressable Market (TAM) of five to ten pct in 2021.
Last calendar week, JP Morgan's Harlan Sur had raised AMD'southward stock toll target from $62 to $86 per share. According to the analyst, AMD's recently announced Xilinx conquering would add v to ten cents in annualized earnings (EPS) once the acquisition achieves closure. It will also upshot in 25 to 30 cents in synergies. Additionally, Sur appeared to concur with AMD direction's view that the deal volition facilitate the expansion of the company'southward footprint in crucial growth sectors such equally 5G wireless networks and democratic vehicles.
Every bit a refresher, AMD reported its earnings for the third quarter in late October. For the three months that ended on the 30th of September 2020, AMD earned $ii.8 billion in revenue, registering an almanac increment of 55.6 percentage and beating consensus expectations by 9.38 per centum. Computing and Graphics segment led the pack with $1.67 billion in acquirement, corresponding to an increase of 30.64 percent relative to the comparable quarter of 2019. This was driven by a significant increment in AMD's Ryzen processor sales which were partially offset by lower graphics acquirement. Similarly, Enterprise, Embedded and Semi-Custom segment generated a revenue of $ane.13 billion, translating to annual growth of 116 percent. This growth was primarily driven past higher semi-custom product sales and increased EPYC processor sales. The company too reported a GAAP EPS of $0.32, beating consensus expectations by $0.02.
As far every bit projections for the fourth quarter of 2020 were concerned, AMD now expects to earn a revenue of $3 billion (+/- $100 million) in the pertinent period, driven past the ramp of new Ryzen, EPYC and semi-custom products and growing customer momentum.
Source: https://wccftech.com/amd-shares-soar-as-goldman-sachs-adds-the-chipmaker-to-its-conviction-list-on-the-back-of-multi-year-share-gain-and-margin-expansion-story/
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