AMD  Advanced Micro Devices Inc.

Exchange

NYSE

Sector

Technology

Industry

Semiconductors

Market Cap.

13.08B

Vuru Grade

11.01/100

Current Price

$13.81
-0.14 (-1.00%)

Growth Price

$0.60
Overvalued by 95.67%

Stability Price

$0.58
Overvalued by 95.82%

Company Metrics

  • P/E 37.12
  • P/S 2.86
  • P/B 31.7
  • EPS -0.6
  • Cash ROIC -18.37%
  • Cash Ratio 0.94
  • Dividend 0 / 0%
  • Avg. Vol. 57.82M
  • Shares 835.00M
  • Market Cap. 13.08B

Company Description

Advanced Micro Devices, Inc. operates as a semiconductor company in the United States, Japan, China, and Europe. Its microprocessors for server platforms include multi-core AMD Opteron processors; notebook PC platforms consist of the AMD Dual-Core Accelerated Processor E-350, AMD Dual-Core Accelerated Processor C-50, AMD Phenom II Dual-Core Mobile Processor, AMD Phenom II Quad-Core Mobile Processo... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

AMD Will Not Fall To $5
Seeking Alpha - 13 hours ago
I usually don't like to talk about a single analyst's price target on a stock unless the situation is very dramatic. Well, that appears to be the case today with regards to Advanced Micro Devices (AMD). Just ahead of the chip company's earnings report ...
Battle Lines Have Been Drawn for Advanced Micro Devices, Inc. - Investorplace.com
Advanced Micro Devices, Inc. (AMD) Stock Soars Ahead Of Earnings - ValueWalk
AMD, Microchip Tech Among Q3 Semiconductor Favorites At Jefferies
Benzinga - 8 hours ago
Previewing the third-quarter results of semiconductor companies, Jefferies said it favors Advanced Micro Devices, Inc. (NASDAQ: AMD). Additionally, the firm said it considers Analog Devices, Inc. (NASDAQ: ADI), Texas Instruments Incorporated (NASDAQ: ...
What's in Store for Advanced Micro (AMD) in Q3 Earnings?
Yahoo Finance - Oct 20, 2017
Advanced Micro Devices Inc. AMD is set to report third-quarter 2017 results on Oct 24. Notably, the company has a positive record of earnings surprises in the trailing four quarters, with an average surprise of 35%.
Advanced Micro Devices: Betting On A Bright Future
Seeking Alpha - Oct 11, 2017
Advanced Micro Devices (AMD) has seen its share price consolidate in recent months after a nearly 700% return in 2016.
AMD Is Priced Beyond Perfection
Seeking Alpha - Oct 17, 2017
In actuality, AMD's products have been performing so well that its main competitor on the CPU side of the business, Intel, has woken up and taken note of AMD's performance. Intel's CEO Brian Krzanich actually felt inclined to defend his company's ...
With Earnings Ahead, the Lid Will Stay On Advanced Micro Devices, Inc.
Investorplace.com - Oct 18, 2017
Without a doubt, Advanced Micro Devices has executed one of the most-impressive turnarounds in recent memory. CEO Lisa Su has transformed the company from playing second fiddle to Intel Corporation (NASDAQ:INTC) in a declining PC space to a ...
AMD Stock: Will The Bull Run Continue? - Amigobulls
Earnings Preview: Advanced Micro Devices
Seeking Alpha - Oct 2, 2017
On a poll I posted on my Value Stocks Journal on September 28, readers overwhelmingly agreed that Advanced Micro Devices (AMD) is a buy ahead of earnings later this month. For short-term traders, the quarterly report will seem like an eternity away but ...
Advanced Micro Devices, Inc. (AMD) Is SCREAMING Higher - Investorplace.com
Why Did Advanced Micro Devices (AMD) Stock Surge Today? - Nasdaq
AMD Doubles Down On Virtual Reality
Seeking Alpha - Oct 17, 2017
Wireless VR is the next evolution of the technology and AMD could be a key provider to various VR headsets. How we ... Last April, AMD (AMD) acquired the assets and personnel of a small outfit called "Nitero" responsible for making VR wireless technology.
NVIDIA Stock Near 52-Week High. How Are Things Looking for the Company? - Motley Fool
AMD: Not So Wrong After All
Seeking Alpha - Oct 20, 2017
After including it in a concentrated, hedged portfolio in April, AMD was down nearly 20% by June. We wrote about how hedging ameliorated its drawdown then.
AMD Becomes 'Top Medium-Term Idea' At Baird
Benzinga - Oct 16, 2017
Analysts Tristan Gerra and Maggie McNally believe Advanced Micro Devices, Inc.'s graphics processing units growth trends for second-half 2017 remain healthy.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for AMD to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate AMD's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$13.81 Current Price

$0.60 Growth Price (DCF)

Overvalued by 95.67%


Growth Rate Assumed by Market: 122.80%


Future Free Cash Flow Growth Rate: 0.0%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$0.58 Stability Price (EPV)

Overvalued by 95.82%


Discount Rate: 15.0%

$0.05 Book Price

Overvalued by 99.64%


Very Poor Cash Return on Invested Capital over the past 5 years

AMD has failed to generate positive returns on its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

AMD has lost $18.37 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow -471.00M -232.00M -193.00M -322.00M 13.00M
divided by
Invested Capital 1.60B 1.62B 1.29B 921.00M 711.00M
Cash ROIC -29.42% -14.30% -15.00% -34.96% 1.83%

Very Poor Return on Equity over the past 5 years

AMD has shown an inability to deliver results for shareholders. This could be due to poor management, AMD operating in a highly competitive industry, or having a weak business in general.

AMD has generated a $114.03 loss for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income -1.18B -83.00M -403.00M -660.00M -497.00M
divided by
Stockholders' Equity 538.00M 544.00M 187.00M -412.00M 416.00M
Return on Equity -219.89% -15.26% -215.51% - -119.47%

Poor Business Performance over the past 10 years

AMD's inability to produce positive free cash flow for the majority of the past 10 years is concerning. It should be a red flag, since this company does not have a track record of delivering results for shareholders. This could be due to poor management or the nature of its business.

AMD has been losing money for the majority of the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow -2.00B -1.32B 7.00M -560.00M 132.00M -471.00M -232.00M -193.00M -322.00M 13.00M

Weak Balance Sheet

AMD's financial position is not ideal. The key is to check whether AMD is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash 1.89B 1.10B 2.68B 1.79B 1.77B 1.00B 1.10B 1.04B 785.00M 1.26B
Current Assets 3.82B 2.38B 4.28B 3.59B 3.23B 2.27B 2.88B 2.74B 2.32B 2.53B
Total Assets 11.55B 7.68B 9.08B 4.96B 4.95B 4.00B 4.34B 3.77B 3.11B 3.32B
Current Liabilities 2.63B 2.23B 2.21B 1.67B 1.77B 1.40B 1.62B 1.44B 1.40B 1.35B
Total Liabilities 8.56B 7.76B 8.43B 3.95B 3.36B 3.46B 3.79B 3.58B 3.52B 2.91B
Stockholder' Equity 2.99B -82.00M 648.00M 1.01B 1.59B 538.00M 544.00M 187.00M -412.00M 416.00M
Current Ratio 1.45 1.07 1.93 2.15 1.82 1.62 1.78 1.90 1.65 1.88
TL-to-TA 0.74 1.01 0.93 0.80 0.68 0.87 0.87 0.95 1.13 0.87

Low or No Reinvestment of Profits over the past 10 years

AMD has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to AMD operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings -3.10B -6.20B -5.94B -5.47B -4.98B -6.16B -6.24B -6.65B -7.31B -7.80B
Retained Earnings Growth - -99.94% 4.18% 7.93% 8.98% -23.77% -1.35% -6.46% -9.93% -6.80%

Loss Making Entity over the past 10 years

AMD has been unable to maintain profitability. It's Costs of Sales have outstripped Revenue consistently. This is a huge red flag, unless the company has been investing heavily for the future. However, even that is dubious since accurately predicting the future of a company like that is extremely difficult.

$14.83 of every $100 of Revenue have been a loss, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income -3.38B -3.10B 293.00M 471.00M 491.00M -1.18B -83.00M -403.00M -660.00M -497.00M
divided by
Revenue 6.01B 5.81B 5.40B 6.49B 6.57B 5.42B 5.30B 5.51B 3.99B 4.27B
Net Profit Margin -56.19% -53.34% 5.42% 7.25% 7.48% -21.82% -1.57% -7.32% -16.54% -11.63%

Inconsistent Gross Profit Margins over the past 10 years

AMD has good gross profit margins, however inconsistency of these margins is a cause for concern. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$38.70 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit 2.26B 2.32B 2.27B 2.96B 5.12B 1.24B 1.98B 1.84B 1.08B 998.00M
divided by
Revenue 6.01B 5.81B 5.40B 6.49B 6.57B 5.42B 5.30B 5.51B 3.99B 4.27B
Gross Margin 37.62% 39.94% 42.05% 45.60% 77.88% 22.78% 37.33% 33.40% 27.06% 23.36%

High Capital Intensity over the past 10 years

AMD spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

80.46% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 1.69B 624.00M 466.00M 148.00M 250.00M 133.00M 84.00M 95.00M 96.00M 77.00M
divided by
Net Income -3.38B -3.10B 293.00M 471.00M 491.00M -1.18B -83.00M -403.00M -660.00M -497.00M
Capital Expenditure Ratio -49.87% -20.14% 159.04% 31.42% 50.92% -11.24% -101.20% -23.57% -14.55% -15.49%

No Dividend History over the past 10 years

AMD has never distributed dividends or has recently suspended their dividend distribution.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid - - - - - - - - - -
divided by
Shares Outstanding 558.00M 607.00M 678.00M 733.00M 742.00M 741.00M 754.00M 768.00M 783.00M 835.00M
Dividend Paid Per Share - - - - - - - - - -
Price at Year End 7.32 2.21 9.72 8.14 5.40 2.28 3.85 2.63 2.98 11.34
Dividend Yield - - - - - - - - - -

History of Stock Buybacks over the past 10 years

AMD has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 558.00M 607.00M 678.00M 733.00M 742.00M 741.00M 754.00M 768.00M 783.00M 835.00M
Stock Bought Back - -8.07% -10.47% -7.50% -1.21% 0.13% -1.72% -1.82% -1.92% -6.23%
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Discussion
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3
Posted by LIM  (on May 28, 2012)
Excuse me for raining on your AMD party but lets look at facts:

In 2002 EPS was approx 35c/share. Today (2012) EPS is approx 35c/share. ..... i.e 10 years and 0% growth.

In 2002 SPS was approx $11/share and today (2012) SPS is $10/share.

So Earnings is stagnant, sales are declining and I dont see any new earth shattering technology on horizon which leads me to my one and only question....

What part of "don't buy this stock for short term profit", don't you understand?
3
Posted by Honeybadger  (on May 26, 2012)
I don't mean to be condescending, but as an investment there are much better places to go with your money in my opinion. Chip manufacturers are essentially commodity companies. In other words they will go through boom and bust cycles depending on where the economy is in the natural cycle. In my experience chip companies, just like commodity companies, work best as a long term trade. Buy when the economy is in the midst of a recession and sell when the recovery is a year or two old. IF you have to buy a chipmaker(or a commodity company for that matter), buy the biggest and most well managed producer you can find. AMD, historically, doesn't qualify on either front. Unless they have something in the works that will reinvent the wheel(or semiconductor), I don't see how they will be anything more than a veiled commodity producer.
1
Posted by KEP  (on August 14, 2017)
Ryzen Threadripper review: AMD's monster 1950X stomps on other CPUs

Ryzen Threadripper’s name tells you its lineage: the ground-breaking Ryzen 7, Ryzen 5, and Ryzen 3 CPUs that have made AMD a contender again, after years of watching Intel dominate.
1
Posted by rossmacleod92  (on May 28, 2012)
exactly
1
Posted by KEP  (on July 29, 2017)
AMD makes a chip suitable for AI/deep learning, gaming and CC mining.
Advanced Micro Devices is calling the Radeon Vega platform, “the fastest GPU in the world for data scientists and immersion engineers”. Historically, AMD hasn’t enjoyed the same street cred at NVIDIA among PC gamers, but their chips are active in computer systems all over the globe, including servers, desktops, laptops and game consoles.

Basically, Vega is AMD’s attempt at finally pulling a fast one over Nvidia. The kind of power touted here has the potential to shift discussion away from Nvidia’s widely-available Pascal offerings, something AMD loyalists have been hoping for what probably has seemed like forever.

AMD has already outlined a couple of ideal uses for Vega (things it’s best at) including machine learning development, photorealistic rendering, driving research behind AI and of course, gaming.

-1
Posted by simplesimon  (on April 24, 2012)
I find your stock evaluation incorrect to say the least.

It's as if the value is being set by its competitor who would only be too pleased to see AMD get lost.

My take is that in spite of the competition's buzz word marketing and insistence upon the fabless model being broken, AMD will deliver more consumer value for less cost than its competitor in 2012
10
Posted by rango55  (on April 25, 2012)
You're joking right? AMD has had TWO years of positive free cash flow in the past 10! They have a mediocre balance sheet, and have just barely started having a positive net income.

Vuru is the place you come for fundamentals - and the fundamentals of AMD are terrible.
1
Posted by simplesimon  (on May 16, 2012)
Of course when you have a competitor that is so desperate as to send 4 billion dollars to one of its channel members to stop them from selling AMD products, it does make commercial success a little more difficult to attain. But that tactic only delayed the inevitable comeback by a few years.

I hope you've made all the money you need with the other guy?
-1
Posted by simplesimon  (on May 15, 2012)
This is the company that will soon emerge as the leader in its field.
5
Posted by rossmacleod92  (on May 20, 2012)
so unlikely.