2. Advanced Micro Devices, Inc. (NASDAQ:AMD)
YTD Stock Performance Through November 22: +86%
In January this year, Jim Cramer painted a contrast between two analyst calls on Advanced Micro Devices, Inc. (NASDAQ:AMD). One of these calls was bullish, while the other was bearish. Cramer said that both were right, since the bearish call was right about Advanced Micro Devices, Inc. (NASDAQ:AMD) in the short term. Cramer said that the optimist call on Advanced Micro Devices, Inc. (NASDAQ:AMD) would eventually would be proven right since he believed the downturn in the semiconductor market would end.
“The bearish analyst [is] right as rain because AMD’s business is awful now and shows no signs of improving, but over the long-haul, the bullish analyst is going to be right, because eventually, the semiconductor downturn will end,” Cramer said.
According to CNBC, Advanced Micro Devices, Inc. (NASDAQ:AMD) is in Jim Cramer’s investing Club’s Bullpen watch list for stocks that could become part of the portfolio.
Advanced Micro Devices, Inc. (NASDAQ:AMD) shares have gained about 86% in 2023 through November 22.
As of the end of the third quarter of 2023, 110 hedge funds tracked by Insider Monkey had stakes in Advanced Micro Devices, Inc. (NASDAQ:AMD).
Artisan Global Opportunities Fund made the following comment about Advanced Micro Devices, Inc. (NASDAQ:AMD) in its Q2 2023 investor letter:
“Among our top contributors were Advanced Micro Devices, Inc. (NASDAQ:AMD), NU Holdings and Netflix. AMD’s data center CPUs are used in the cloud service provider (CSP) servers. In addition to the broader secular tailwind from cloud adoption, the company has a performance and pricing advantage over Intel, which we believe will enable it to continue capturing market share. However, the recent stock price rally was due to growing excitement around the company’s AI exposure. It will launch its new MI300 graphics processing unit (GPU) chip later this year to compete against the dominant market leader NVIDIA. Similar to its approach that won market share from Intel within the CPU market, AMD’s product will aim to provide similar performance at a more attractive price. AMD is already working with Microsoft and Meta, while Amazon publicly stated that it is evaluating AMD’s inferencing chips. Using assumptions around the total GPU market size, potential market share gains and price points, our research indicates this could be a $20 billion opportunity for AMD. That would nearly double its revenue. While the company has not historically missed many deadlines, there is execution risk as it works to manufacture and distribute these complex chips at scale, which, combined with an elevated valuation after the stock’s strong performance run, led us to trim the position.”
