In the latest trading session, Advanced Micro Devices (AMD) closed at $123.25, marking a +1.24% move from the previous day. The stock exceeded the S&P 500, which registered a gain of 0.55% for the day. At the same time, the Dow added 0.25%, and the tech-heavy Nasdaq gained 0.63%.
The chipmaker's shares have seen an increase of 12.59% over the last month, surpassing the Computer and Technology sector's gain of 11.3% and the S&P 500's gain of 6.29%.
The investment community will be paying close attention to the earnings performance of Advanced Micro Devices in its upcoming release. The company is expected to report EPS of $0.56, down 18.84% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $7.41 billion, indicating a 27% increase compared to the same quarter of the previous year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $3.97 per share and a revenue of $31.78 billion, representing changes of +19.94% and +23.24%, respectively, from the prior year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Advanced Micro Devices. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 3.8% downward. At present, Advanced Micro Devices boasts a Zacks Rank of #3 (Hold).
With respect to valuation, Advanced Micro Devices is currently being traded at a Forward P/E ratio of 30.68. This valuation marks a premium compared to its industry's average Forward P/E of 18.04.
Meanwhile, AMD's PEG ratio is currently 1.25. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Computer - Integrated Systems industry currently had an average PEG ratio of 1.92 as of yesterday's close.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 84, this industry ranks in the top 35% of all industries, numbering over 250.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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Advanced Micro Devices, Inc. (AMD): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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