AMD's Price Target Slashed by Bank Amid Multiple Concerns

Truist Securities cut its price target on AMD (AMD) to $111 from $130 while keeping a Hold rating on the shares.  According to the bank, a number of negative aspects disclosed in conjunction with the chip maker's first-quarter results have undermined its overall outlook.

AMD's Negative Catalysts

The company's decision to abandon China will lower the revenue that it obtains from its AI chips in Q2 and Q3, Truist warned. Additionally, the bank expressed concern about AMD's competitiveness in general in the AI chip market, even as it launches new offerings for the latter sector. As a result, Truist is concerned about its ability to obtain a great deal of revenue from its new chips.

Moreover, the chip maker will probably have to write down its inventory in Q2, according to the bank.

AMD's Upbeat Attributes

The company's Client business will rebound going forward due to its improved products, Truist stated. Additionally, the bank stated that the company's Q1 results were generally positive.

The Recent Price Action of AMD Stock

In the last month, the shares have been flat, while they have dropped 13% in the last three months.

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Disclosure: None. This article is originally published at Insider Monkey.