Advanced Micro Devices (NASDAQ:AMD) Stock Falls 7.5% – Here’s Why

Shares of Advanced Micro Devices, Inc. (NASDAQ:AMD) fell 7.5% during mid-day trading on Monday. The stock traded as low as $466.07 and last traded at $466.84. Approximately 31,604,164 shares traded hands during mid-day trading, a decline of 0% from the average daily volume of 31,686,049 shares. The stock had previously closed at $504.80.

Advanced Micro Devices News Summary

Here are the key news stories impacting Advanced Micro Devices this week:

• Positive Sentiment: AMD’s growth outlook remains supported by strong demand for AI accelerators and rising adoption of its EPYC server processors. Analysts will look for evidence that data-center momentum can offset softness in PCs. Buy, Sell or Hold AMD Stock? Key Tips Ahead of Q3 Earnings
• Positive Sentiment: Morgan Stanley raised its AMD price target from $465 to $510 while maintaining an Equal Weight rating, signaling some analysts see additional upside if earnings and guidance meet expectations. Morgan Stanley AMD Recommendations
• Positive Sentiment: AMD and Nvidia Ventures backed AI startup Hark at a reported $6 billion valuation, potentially reinforcing AMD’s strategic position in the expanding AI ecosystem. Nvidia and AMD Are Backing Hark
• Neutral Sentiment: Tuesday’s earnings release is the immediate catalyst. Options activity indicates unusually high volatility and a meaningful risk of a post-earnings move in either direction. Barchart AMD Earnings Analysis
• Negative Sentiment: Intel’s warning has increased concern that weakness in the PC market could spread to AMD, while tighter memory supply and higher prices may pressure costs across the semiconductor industry. AMD Slides Ahead of Earnings as PC Worries Linger
• Negative Sentiment: Bearish commentary highlights AMD’s stretched valuation—approximately 120 times earnings in the supplied market data—and fears that AI-related expectations and financing activity have become excessive. Some analysts also recently reduced semiconductor price targets. AMD and Micron Selloff Is Just the Beginning

Wall Street Analysts Forecast Growth

Several research analysts recently weighed in on AMD shares. Susquehanna increased their price objective on Advanced Micro Devices from $620.00 to $650.00 and gave the stock a “positive” rating in a research report on Wednesday, October 28th. Cantor Fitzgerald reissued an “overweight” rating on shares of Advanced Micro Devices in a report on Monday, October 5th. The Goldman Sachs Group upped their price objective on shares of Advanced Micro Devices from $450.00 to $640.00 and gave the company a “buy” rating in a research note on Monday, July 6th. Wedbush reaffirmed an “outperform” rating and issued a $600.00 price objective on shares of Advanced Micro Devices in a research report on Tuesday, October 20th. Finally, Roth Capital lifted their price objective on Advanced Micro Devices from $500.00 to $650.00 and gave the stock a “buy” rating in a report on Friday, July 24th. Three equities research analysts have rated the stock with a Strong Buy rating, thirty-one have assigned a Buy rating, eight have issued a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and an average price target of $608.78.

Advanced Micro Devices Stock Down 7.5%

The company has a current ratio of 2.61, a quick ratio of 1.91 and a debt-to-equity ratio of 0.03. The firm has a market capitalization of $762.10 billion, a price-to-earnings ratio of 120.01, a PEG ratio of 5.18 and a beta of 2.45. The stock has a fifty day moving average of $548.29 and a 200-day moving average of $409.20.

Advanced Micro Devices (NASDAQ:AMD) last announced its quarterly earnings data on Tuesday, August 4th. The semiconductor manufacturer reported $1.66 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.62 by $0.04. The firm had revenue of $11.54 billion during the quarter, compared to the consensus estimate of $11.31 billion. Advanced Micro Devices had a return on equity of 12.30% and a net margin of 15.58%. The business’s revenue for the quarter was up 50.1% on a year-over-year basis. During the same period in the prior year, the business earned $0.48 EPS. As a group, sell-side analysts expect that Advanced Micro Devices, Inc. will post 6.50 EPS for the current year.

Insider Transactions at Advanced Micro Devices

In related news, EVP Paul Grasby sold 15,000 shares of the stock in a transaction dated Monday, August 17th. The shares were sold at an average price of $514.91, for a total transaction of $7,723,650.00. Following the completion of the sale, the executive vice president owned 117,687 shares in the company, valued at $60,598,213.17. This trade represents a 11.30% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Lisa Su sold 70,000 shares of the firm’s stock in a transaction on Thursday, September 10th. The shares were sold at an average price of $506.80, for a total value of $35,476,000.00. Following the completion of the sale, the chief executive officer owned 3,032,156 shares of the company’s stock, valued at approximately $1,536,696,660.80. This trade represents a 2.26% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 231,100 shares of company stock valued at $114,867,400 over the last 90 days. Corporate insiders own 0.50% of the company’s stock.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently bought and sold shares of AMD. Southpoint Capital Advisors LP grew its stake in Advanced Micro Devices by 50.0% in the first quarter. Southpoint Capital Advisors LP now owns 900,000 shares of the semiconductor manufacturer’s stock valued at $183,087,000 after acquiring an additional 300,000 shares during the period. Dimensional Fund Advisors LP increased its holdings in shares of Advanced Micro Devices by 6.0% in the first quarter. Dimensional Fund Advisors LP now owns 5,142,516 shares of the semiconductor manufacturer’s stock worth $1,045,954,000 after acquiring an additional 291,165 shares in the last quarter. Ferguson Wellman Capital Management Inc. increased its holdings in shares of Advanced Micro Devices by 6,968.7% in the third quarter. Ferguson Wellman Capital Management Inc. now owns 140,313 shares of the semiconductor manufacturer’s stock worth $85,995,000 after acquiring an additional 138,328 shares in the last quarter. Douglas Lane & Associates LLC raised its position in shares of Advanced Micro Devices by 2,748.0% during the third quarter. Douglas Lane & Associates LLC now owns 85,952 shares of the semiconductor manufacturer’s stock worth $52,582,000 after purchasing an additional 82,934 shares during the period. Finally, Nan Shan Life Insurance Co. Ltd. raised its position in shares of Advanced Micro Devices by 1,288.6% during the second quarter. Nan Shan Life Insurance Co. Ltd. now owns 220,170 shares of the semiconductor manufacturer’s stock worth $127,899,000 after purchasing an additional 204,315 shares during the period. Institutional investors own 71.34% of the company’s stock.

About Advanced Micro Devices

Advanced Micro Devices, Inc (NASDAQ: AMD) is a global semiconductor company that designs high-performance computing, graphics and adaptive computing products. Its offerings serve data centers, personal computers, gaming systems, embedded markets and other specialized applications.

AMD’s product portfolio includes Ryzen processors for desktop and notebook computers, EPYC server processors, Radeon graphics processing units, and Instinct accelerators for artificial intelligence and high-performance computing.