Advanced Micro Devices Inc (AMD)

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WHISPER NUMBER That said, the results should be considerably narrower than last year's loss of 10 cents per share. Revenue, meanwhile is seen rising 11.9% to $1.07 billion.
But enthusiasm surrounding the stock has pushed earnings expectations much higher. EarningsWhispers.com , for example, reports a whisper number of breakeven for AMD's fourth-quarter report, and some analysts are even calling for a profit on the quarter.
Hitting the whisper number would be a major coup for AMD bulls, while a profit on the quarter could send the stock soaring by validating the current bullish atmosphere surrounding the shares.
Taking a closer look at Wall Street's expectations, we find that Zacks data reports 10 buys, 10 holds and no sells for AMD stock. The 12-month consensus price target, meanwhile, rests at $8.97, a discount to AMD's close at $10.58 on Friday. Once again, guidance could make or break the sentiment backdrop for the shares, as there is room for both upgrades and downgrades depending on the results.


But there are signs of pessimism in AMD stock's sentiment backdrop. For instance, short sellers increased their holdings by 5% during the most recent reporting period. Currently, some 86.6 million shares of AMD stock are now sold short, representing roughly 11% of the stock's total float.

Click to Enlarge  But short sellers don't appear to be taking AMD's quarterly report lightly. Calls have been quite popular during the past couple of weeks, and it seems natural that some of these short sellers are hedging their positions. The most recent Feb. put/call open interest ratio arrives at 0.60, down considerably from its December highs. Meanwhile, the 3 Feb. put/call OI ratio arrives at 0.36, with calls nearly tripling puts among options most affected by AMD's Jan. 31 earnings report.
With 3 Feb. implieds pricing in a move of more than 15.7% for AMD stock, the upper bound lies near $12.15, while the lower bound rests near $8.85. AMD's 10-day and 20-day trendlines lie just overhead in the $11 region, while $12 could be a major hurdle for the shares. Meanwhile, support should arise near $10, and below that at $9.50, which is home to the stock's 50-day moving average.
2 Trades for AMD Stock
Call Spread: Those traders looking for a strong report from AMD might want to consider a Feb. $11/$12 bull call spread. At last check, this spread was offered at 31 cents, or $31 per pair of contracts. Breakeven rests at $11.31, while a maximum profit of 69 cents, or $69 per pair of contracts, is possible if AMD stock closes at or above $12 when February options expire.
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Read more: http://investorplace.com/2017/01/advances-micro-devices-inc-amd-stock-bulls/#ixzz4WIzXyXrN