Why Is AMD Stock Trading Lower On Monday?
Portfolio Pulse from Anusuya Lahiri
Advanced Micro Devices Inc (AMD) shares are trading lower after a downgrade by Morgan Stanley analyst Joseph Moore, who cited high valuations and competition from Nvidia. Despite the downgrade, AMD is expected to gain market share in the CPU markets. Additionally, there are concerns about AMD's progress with Samsung on 3-nanometer chip technology, with suggestions to invest in TSM's 2-nm products instead. AMD stock has gained over 26% in the last 12 months.
June 10, 2024 | 5:14 pm
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POSITIVE IMPACT
Nvidia's competitive position is highlighted as a factor in AMD's downgrade by Morgan Stanley. Nvidia's Blackwell launch is seen as a challenge for AMD.
Nvidia's competitive position and product launches are seen as challenges for AMD, indirectly benefiting Nvidia's stock.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 50
POSITIVE IMPACT
Analysts suggest AMD should invest in TSM's 2-nm products instead of focusing on Samsung's 3-nm technology.
TSM is suggested as a better investment for AMD's chip technology, which could positively impact TSM's stock.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 40
NEUTRAL IMPACT
Broadcom is mentioned as a large-cap AI company that is more reasonably valued compared to AMD, according to Morgan Stanley.
Broadcom is mentioned in comparison to AMD's valuation but is not the primary focus of the news.
CONFIDENCE 70
IMPORTANCE 50
RELEVANCE 30
NEUTRAL IMPACT
Investors can gain exposure to AMD through the Invesco QQQ Trust, which includes AMD in its portfolio.
QQQ is mentioned as a way to gain exposure to AMD, but the impact on QQQ itself is minimal.
CONFIDENCE 60
IMPORTANCE 30
RELEVANCE 20
NEUTRAL IMPACT
Investors can gain exposure to AMD through the SPDR S&P 500 ETF, which includes AMD in its portfolio.
SPY is mentioned as a way to gain exposure to AMD, but the impact on SPY itself is minimal.
CONFIDENCE 60
IMPORTANCE 30
RELEVANCE 20
NEGATIVE IMPACT
AMD shares are trading lower after a downgrade by Morgan Stanley due to high valuations and competition from Nvidia. Despite the downgrade, AMD is expected to gain market share in the CPU markets.
The downgrade by Morgan Stanley directly impacts AMD's stock price negatively in the short term. The high valuation and competition from Nvidia are key concerns.
CONFIDENCE 90
IMPORTANCE 90
RELEVANCE 100