Advanced Micro Devices Gets A Price Target Bump At Canaccord

Manikandan Raman
0

Canaccord Genuity has reiterated its Buy rating and raised its price target by $1 to $8.50 on Advanced Micro Devices, Inc. (NASDAQ: AMD) shares given gradually increasing confidence in the CPU and GPU roadmaps.

The brokerage is also positive on 14nm yields at partner Global Foundries amid foundry influences from both Samsung and International Business Machines Corp. (NYSE: IBM).

"While we recognize that roadmap execution, competition and financial risks remain, we remain impressed with the new management team and anticipate a quick recovery to solid profitability given lower expenses necessitated by the company's recent struggles. Finally, we believe risk/reward remains unbalanced to the upside despite the recent stock move," analyst Matthew Ramsay wrote in a note.

Related Link: Jefferies Analysts Are Buyers Of Nvidia Amid Sales Momentum, Probability Of Upside

Ramsay's bullish thesis on Advanced Micro Devices is based on the following:

  • "AMD re-emerging as a competitive second source to Intel Corporation (NASDAQ: INTC) across relevant x86 CPU markets."

  • "Gradual unit share recovery with Polaris/Vega in discrete GPUs with ASPs trending higher for both AMD and NVIDIA Corporation (NASDAQ: NVDA)."

  • "Ramping business with AMD's unique position with key gaming console partners with 4K/VR gaming increasing hardware refresh rates."

The analyst said Advanced Micro's Desktop Zen platforms should launch very late in the fourth quarter of 2016 (1H/17in volume), server introductions should be in the second quarter 2017 and desktop APU products should ramp in the second half of 2017. Ramsay expects modest share recovery at materially accretive margins.

At time of writing, shares were marginally up (0.34 percent) and trading at $7.45.

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Latest Ratings for AMD

Jul 2016

Credit Suisse

Maintains

Underperform

Jul 2016

Bernstein

Downgrades

Underperform

Jun 2016

Canaccord Genuity

Upgrades

Hold

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