AMD stock has surged 20% due to interest rate cuts, GPU wins, and PlayStation 6 contract

From Nasdaq: 2024-10-02 01:33:15

Advanced Micro Devices stock (NASDAQ: AMD) has seen a 20% rise in the past month, similar to Intel stock’s gains. AMD benefits from the Fed’s interest rate cut and recent wins in its GPU business. Lower rates are positive for tech growth, and AMD’s AI chips are gaining traction. AMD also secured a major contract for Sony’s PlayStation 6 processor, boosting its long-term outlook.

The increase in AMD stock has been volatile over the past three years, with varying annual returns. The Trefis HQ Portfolio has outperformed the S&P 500 each year in the same period, offering better returns with less risk. AMD trades at a high multiple but could be justified by the recovery in the PC market and AI demand. The company’s valuation is estimated at $168 per share.

Investors are watching how AMD will perform in the uncertain economic environment following rate cuts. With a strong outlook in AI applications and PC market recovery, AMD is positioned for growth. Meanwhile, the company’s stock performance has been more volatile compared to the Trefis HQ Portfolio.

AMD’s recent success is reflected in its returns, with 10% monthly returns and 11% year-to-date gains in September 2024. The stock has delivered a cumulative total return of 1347% since 2017, outperforming the S&P 500. The Trefis Reinforced Value Portfolio also shows solid returns compared to the benchmark index.

Overall, AMD’s recent developments and strategic wins position the company for continued growth, supported by strong demand for its AI chips and GPU offerings. Despite some volatility in its stock performance, the outlook for AMD remains positive, with potential for further gains in the future.



Read more at Nasdaq: What’s Happening With AMD Stock?