After a mediocre report and not so great guidance and analyst comments of a price war, it seems like now might be a good time to buy Intel for the long term. I haven't posted in a while. I was a long term AMD holder, but I exited that position a while ago and I have been sitting on cash waiting for a new opportunity. IMO, Intel is that opportunity. In the next week or so I'll be buying shares and 2008 leaps. Below $18, Intel is almost a steal. I believe Intel could have a turnaround year in 2007 and be back up in the $30s.

but might get back in again before earnings

I'm considering making an earnings play as well. I'll probably use some out of the money calls to do this. I'm waiting for the april premiums to come down. I think AMD hasn't hit to bottom yet, but I could be wrong, in which case I'll miss the opportunity. I'm waiting for the round of analysts over the next couple of weeks to declare AMD as 'roadkill'. I almost miss Ashok for his laughable comments.

Looks like I was not the only one trying to get out. I managed to escape at $37.40.

The perception that AMD is going to have competitive issues going forward is going to hurt the stock more than it should, so I will probably look for a buying opportunity over the next several months.

Time for me to make an exit from AMD stock after a long time being in through various positions with both shares and options. I'm still amazed how much I made from this stock alone, so it will always hold a special place as one of my all time great stocks. I was waiting to see some NGA benchmarks, and these have more than convinced me that AMD is in trouble. Intel set up benchmarks or not, they are impressive.

I'll probably even buy some Intel stock. It looks pretty cheap here. Obviously it is going to take several quarters or even up to a year for NGA to make a financial impact on either company, but no harm in changing my positions early. I might miss some more run up in AMD due to excellent Q1 results, and I might not buy the bottom on Intel due to poor Q1/Q2 results, but it should be close.

I just read one of the articles that says Conroe will also have an EE edition, which would be clocked higher. Probably 3Ghz. That is more like what I was expecting. So it looks like Intel will in fact leap over AMD in Q3, although how much remains to be seen. It would be nice to get some benchmarks to get a feel for performance per clock.

Conroe @2.67Ghz in Q3.

The FX-60 is at 2.6Ghz now, and there will be a 2.8Ghz FX with improved performance per clock in Q3.

What happened to Intel's NGA blowing away AMD? Unless Conroe has some serious performance per clock improvements (25%) over current P-M based chips, I don't think there is going to be any blowing away of AMD. Perhaps parity or slight advantage, but it is looking like a close race at this point, and if that is the case AMD should still be able to do well financially in 2007.

I'm still holding my shares, and some of my pessimism in holding is fading.

This is some of the info I have been waiting for, but it appears I will have to wait longer.

Woodcrest 3.0, 2.66, 2.33, 2.0, 1.86, 1.6.

Do these bins strike anyone as very odd? When do you ever see a product intro where the lowest bin is about 1/2 the frequency of the highest bin? I have two guesses here. Either 3.0 is a stretch or 1.6 is an ultra low voltage/low power part.

The Conroe article next to this one showed a top bin of 2.66.

Something seems funny, and I think I'll have to wait around some more holding my AMD stock to see what it is.

AMD's next generation cores they are about six months into
the development cycle.

Again - why does that matter? AMD has K8L coming out next year and more derivatives after that. K8L could add all sorts of things to a very good K8 core that would keep it competitive. If a u-arch ain't broke, why fix it? The existing K8 u-arch is a nice balance of performance per clock, frequency, and power. It isn't the best at any single one of these, but to date it is the best at the combined result, otherwise it wouldn't be selling so well.

I do believe Intel's NGA can catch up or surpass K8 in combined result and maybe even win all three of the categories I mention above, but K8L could step up the bar again in 2007.

P-M evolution with major enhancements; or else it would have little chance of meeting the performance/watt claims that Intel has made publicly.

Seems to me a P-M is already a performance/watt leader at a given frequency. If Intel just enhanced this core so it could run at 3Ghz, they would have a winner in performance/watt and performance as they have claimed. I don't see why the big leap is necessary, and Intel openly admits it is derived from P-M. That is unless you are arguing that Intel can't achieve 3Ghz without majorly ripping up the pipeline and then adding in more features to gain back performance per clock. At that point, how do you even argue it is P-M derived? Where do you draw the line what is a new core and what is not? For all we know K8L is a rip up as well. So saying AMD has no new core until 2009 and Intel does is not really fair until we hear more details of both NGA and K8L.

Well given Intel's NGA is an evolution of the P-M core, I don't see the big deal that AMD won't have a new ground up core anytime soon. The mentioned K8L could be as much of a difference as between P-M and NGA. P4 was a brand new core and look where that led. Perhaps Intel and AMD are becoming more cautious and using more proven u-architectures going forward.

You're still invested in AMD and not Intel.

I'm with Bob here. It isn't obvious the tide has changed yet to us outsiders and the general public otherwise AMD stock would not be outperforming Intel stock every day.

I even believe Intel has something strong coming up with NGA and I still hold AMD and not Intel. I'm not going to change my holdings until it is obvious in the price moves of AMD and Intel stock. Why should I not wait for this? One thing I have learned is to play the momentum of the stock and don't try to guess the top or bottom. Just wait until the trend is pretty obvious in the stock and then get in or out. AMD isn't going to drop 25% overnight, and Intel isn't going to jump 25% overnight.

It may be a great time to buy Intel, but that doesn't mean that it is a great time to sell AMD. I do think we should sell AMD within the next 6 months, but I'll wait for the signal from the stock itself. For now, I'm holding tight as AMD continues to run up.

How far out, timewize?

Depends on the situation. If I think a stock is going to make a move quickly, I buy 75% 1 month out, and 25% 3 months out. I almost always spread it out to reduce risk yet maintain short term leverage. For instance, a while back I bought 50% Oct AMD calls and 50% Jan AMD calls. I lost everything on the Oct calls, but made it all back easily on the Jan calls and much, much more. At one point I was up 5X on the Oct too, but I got greedy and held too long.

If I just have a general feeling, I'll go for leaps, but I hate paying huge time values because situations can change quickly. So in those cases I may just buy stock directly.

I'm currently holding Feb 40s and a lot of stock.

I'm quite tempted to buy some Intel at these levels, and I will if the Feb 40s pay out.

2. Football. A long pass thrown in desperation, especially near the end of a game.

Part of my investment style is to take some gains from more conservative investments and throw an occasional Hail Mary by buying well out of the money calls on stocks I think are likely to make a breakout. This strategy has worked rather brilliantly. The times I lose out on a bad call are more than made up for the times I make 10x or 20x gains. AMD has been one of my better plays.

I guess you are trying to say AMD is throwing a Hail Mary. Perhaps you are somewhat correct in this. I have been saying for weeks I think Intel's NGA is going to hurt AMD and I plan on exiting my position when it is obvious that is what is happening. I'm still holding now because the street seems in love with AMD at the moment, and there is always the possibility of another Intel screwup.

Talk about vapor....

It is vapor, but it had a purpose. The announcement was that the quad core parts would be platform compatible, meaning customers considering dual core Opteron today have an easy upgrade in 2007. It makes sense for AMD to brag about this before launching as it affects their customer appeal.

Advanced Micro Devices is promising that no platform change will be required to move to its next-generation quad-core processors. And to prove it, AMD plans to demonstrate the technology in the middle of this year.

Picked up 5k shares this morning at 35.21.

Nice call. I missed some trading opportunities the last few days. I'm still holding strong in shares for now. I think we'll be seeing 40s soon.

It does make me think harder about getting out. I think my plan is I'm going to hang on until it is very obvious that the momentum has shifted and AMD stock is taking a tumble. It may be that this never happens, and if it does I won't be selling at the absolute peak, but I don't mind that so much. AMD may improve their products, and Intel's NGA may not live up to the hype. Meanwhile it appears AMD will still be cranking out a ton of profit in 2006.

I'm pretty conflicted at the moment. One part of me says buy more, and the other says sell. So I will just hold for a while and see how it goes. No way I can lose at this point save for an overnight drop to $10.

Prudential: Raises price target to $55

Wow. Reports like that make me want to hold AMD longer. I am very glad to have held through the earnings, and I think that is the first time I have ever said that. I'm pretty stunned by the results.

I still think it advisable to start reducing positions in AMD due to Intel's upcoming processors. I sold a little today, and I'll probably sell more as it heads through the $40s. I will likely be all out by April unless rumors about Intel's NGA start changing toward the better for AMD. Without Intel's NGA coming on, AMD could easily be a $100 stock by the end of this year. With Intel's NGA I think AMD will get oversold due to fear. I still think 06/07 results will be very good for AMD and the stock may come back after a fear dump, but I have to play the momentum.

I would probably buy back if it took a significant dive.

AND, 3.3GHz.

If true, this is admittedly bad news for AMD. I've been a long time AMD investor, but I think it may be getting close to the time to move on to something else for a while. I haven't exited yet. I'm going to see how Q4 turns out first, for better or worse.

I do think AMD will have a great 2006, but the forward looking isn't going to be good if AMD loses the top performance status it has now.

If I do exit, I'll buy some 2007 or 2008 leaps with a small portion of my gains just in case there is another Intel screwup.

Given that it took just 15m shares to raise AMD's price $1.33 the previous day and 25m shares today could only drop AMD $.92 it sounds like there is still an on-balance demand for AMD stock.

That is an excellent point. AMD was also overdue for a pullback. I'm surprised it actually stayed above $35. This drop hasn't scared me out. Look at it this way. It closed higher today than it did 2 days ago, and 2 days ago we were all happy with the price. It only looks bad because it was down $2 from its intraday high.

I'm holding out for at least another month, and probably longer.

I could understand a delay in Merom due to TDP issues that would not affect Conroe or Woodcrest.

Of course Merom TDP issues may point to static leakage problems which could also translate into a speed limit for Conroe and Woodcrest. Hard to say without more data. I'm watching closely for signs to hold my AMD stock longer.

The K8 has an IMC-- Conroe and Woodcrest don't. And for Woodcrest, AMD can always deploy QC. And of course, Intel will have nothing competitive beyond 2 sockets.

Yeah I know all that. And Conroe clock for clock without IMC will likely perform better than A64. If Conroe comes out at 3Ghz, AMD probably won't be competitive in that space. AMD should sustain a lead in the 4 core and up space, but that won't be enough to sustain the stock. If AMD loses the performance lead badly in desktop and mobile, don't you think that is going to hurt the stock?

Merom != NGA...

Huh? I thought Merom, Conroe, and Woodcrest were all variations of the same new core. Merom was the one optimized for mobile with a lower TDP.

I was responding more to the 2.33Ghz launch frequency. I wouldn't expect Conroe or Woodcrest to be more than 2 speed grades above this even with relaxed TDP. So maybe 2.66ghz Conroe competing against 3.0Ghz Athlon 64 on an improved platform. I think the A64 would come out on top in that case.

My fear was, and maybe still is, that Conroe and Woodcrest are going to launch around 3Ghz or more. I don't think AMD will be able to compete with that in that timeframe.

What I don't want to see as an AMD investor is headlines saying Intel is stealing back marketshare because of superior performance of their next generation parts. Stuff like that will kill the stock price as the forward looking assumption will be AMD earnings will come down, whether true or not.

I think we need a couple more sources before we can assume Merom/Conroe/Woodcrest is in some trouble. Most sources to date have said it is on track or ahead of schedule. I would love to believe this article that Merom won't be out until September and then only at 2.33Ghz because it would allow me to hold my long term AMD position longer. My only fear is Intel's next gen cores, and if they are showing some signs of problems, then AMD is in the clear for 2006, 2007, and probably beyond.

If AMD maintains their performance lead in desktop and server and is at least somewhat competitive in mobile, I can see the stock trading $75-100 by this time next year. A few more signs that Intel's next gen. isn't as good as hoped for Intel, and the $75-100 may happen even sooner.

I have to admit the chart sure points to a big pullback happening soon. The stock has not taken any healthy breathers lately. Probably the day after earnings like always.

The AMD chart is insane.

This is really an amazing wall of worry. The market is supposed to be forward looking by six months.

Maybe it is. If you consider AMD could earn $1.50-$2.00/share next year, then the current price doesn't seem so ridiculous. After a couple of $.40-.50 quarters, $35 will look cheap. I would think the stock could trade much higher based purely on forward looking earnings.

I still have concerns over Intel's next gen stuff throwing a wrench into the valuation of AMD stock. It may be AMD can earn $.50/quarter, but the future might look bleak because of an Intel comeback, and in that case the stock is not going to get a very good multiple.

Maybe Dell was pissed at the Apple deal, and the delay of Dempsey.

I do think all the delays and problems with Intel's P4 based products has hurt Intel's relationship with Dell, but it seems like this would all be mended with the next gen cores. I do agree Woodcrest will still be behind Opteron in 4 core (either 2x2 or 4x1) and up solutions, so that would make sense if it is just a high end server.

I don't think quad core is going to happen on 90nm, and 65nm looks no where in sight. I'm not counting on that for any investment decision, but like you said AMD is in good shape without it.

Dell will start selling AMD-based computers as early as the second half of 2006.

This makes no sense. Merom/Conroe/Woodcrest will be well out by this time and should close much of the performance lead AMD has if we are to believe all the rumors to this point. There are enough rumors that I believe them this time. Dell should have adopted AMD a year ago, but I think the window is closed now.

Sold my trading position completely and bought some out of the money Jan and Feb calls as I think Q4 earnings are going to be spectacular, but I kept most as cash. I still have a large long term position in AMD that I am also looking for an exit on. I may wait to see if Intel's new cores live up to the hype though. I don't care if I sell exactly at the peak as I already made a boatload.

Most of the people seems to OVERESTIMATE the ramp speed of a
new product design from INTEL - WAY overestimate.

The next amusing thing for me is, that most "AMD'ler" have
FEAR

Buggi- I agree with you that Conroe won't have a financial impact on AMD in 2006. It will ramp pretty slowly.

But it is FEAR that drives the stock price, and that is all I am concerned about.

If Intel regains the performance crown in mobile, desktop, and server, what kind of impact do you think that will have on AMD stock? A big one.

I do think AMD could earn $1.50 or more in 2006. That alone justifies a much higher stock price than today. But if forecasts say AMD is going to have a terrible 2007 because of Intel's return, the stock isn't going to be worth more than it is today.

I've seen some unsubstantiated rumors claiming that Conroe will debut at 2.93GHz

Now my next question is: These next gen cores lengthened the pipeline compared to today's Yonah. Was IPC sacrificed to do so? I know there are numerous uarch improvements to the core. I'm wondering how overall IPC is going to fare for these new cores. If they can sustain or improve IPC and and also get to around 3Ghz, I think AMD is going to have some serious competition. I don't expect AMD's initial 65nm parts to solve that problem. If we remember back to when AMD launched 90nm parts, the 130nm parts were clocked higher at the time. This was due to mature process vs. new process, and I expect the same when going from 90nm to 65nm.

Assuming Intel hits their plans this time, Intel will be in good shape. All the rumors point to being on track, as well as the early demo of these cores they did at the last IDF. As an AMD shareholder I'm not going to count on Intel screwing up again.

I think AMD is going to have a spectacular 2006 financially, but I'm not so sure about the stock because of the fear of an Intel comeback.

Yonah absolutely rocks in performance, even compared to an Athlon X2 with equal the cache size and frequency.

Yonah looks very good at the same frequency. The question is can it keep up with or surpass Athlon X2 frequency? I seems like it might in the mobile space and will be a great part there, but I haven't seen any evidence to date that Yonah or derivatives will equal or exceed Athlon X2 frequency in the desktop/server space. Is that coming soon, or will we have to wait for Conroe/Woodcrest to possibly see this? AMD may be facing some trouble in the 2nd half of 2006. I expect AMD to improve both IPC and frequency by then, but I expect Merom/Conroe/Woodcrest will have a more significant IPC and/or frequency boost.

It seems AMD also hints at some new stuff too, but that won't be until 2007. Until then, the only boost to AMD appears to be DDR2 and maybe a minor revision of the current core.

I'm a current AMD stockholder who has concerns about Intel's new stuff coming in 2006. I'm thinking about exiting AMD over the next few months, and possibly getting back in later in the year if Intel's new stuff doesn't prove as much of a win as it is being talked up to be. I think the hype alone is going to have a negative impact on AMD's share price throughout most of 2006.

I was totally shocked by a piece of advertising in my mailbox today from hpshopping.com.

Wow that is a first and is great to hear.

I also get the hpshopping mailings, but I have not yet seen this one.

So for equity method, how is the value of SPSN shares held reported on the balance sheet? I understand how the 40% earnings works out on the income statment, but I assume the balance sheet would reflect the cost method for the SPSN shares they now own, meaning the number of shares AMD has of SPSN x 12.

The SPSN shares will be accounted for under the equity method going forward.

And how does that work? Is it value of the shares on the market or the value of 40% of Spansion's equity? If it is 40% of Spansion's equity, than I stand corrected, the IPO price does directly affect AMD's asset in SPSN stock, because SPSN's equity will be lower than expected.

At some point AMD starts selling SPSN shares, however, they'll be getting cash equal to the value of the shares on the market...

The market price when? Thanks.

It becomes an investment holding. I'm not certain on when, but I believe the price at the close of the quarter. Someone please correct me if I am wrong. I'm no accountant.

Some specific portion of that shortfall must effectively come straight out of AMD's pocket. It is what, 40%? 60%?

No, that is not how it works. SPSN gets all the cash from the IPO. A portion of AMD's equity (assets-liabilities) now go to SPSN and they account for them. AMD looses some equity here, but they gain equity by getting shares of SPSN. And the equity value of AMD shares of SPSN are based on the market price, which I bet is going to be higher than $12 by year end. Also SPSN owes AMD some money for loans, and that gets paid back.

My guess is AMD just gained a good amount in equity (but lost overall in value of assets). Yes that equity could be higher, but the IPO price is not important. The market price is.

Care to tell us how much the shortfall from $16 - $18 to
$12 directly cost AMD?

Nothing...

AMD will have the same # of shares regardless of the IPO price. The only affect this has on AMD is the value of their new asset, the SPSN shares they hold.

I suspect that SPSN shares will go up to close to what AMD was originally asking for, for a net affect of 0 on them. AMD declares the value of SPSN shares at what the market prices them at.

SPSN on the other hand, got short changed. They received less cash than they wanted, but since more shares were offered than were originally planned, it didn't make a huge difference there either.

I'm not sure about write offs either. It seems like there is going to be a bunch of adjustments, and I don't know which ones have to be declared on the income statement. Spansion will be paying back AMD for some loans, but I imagine there were the fees of doing the IPO, and I don't know if those get charged to AMD or Spansion. Should be an interesting Q4 results. I think operationally, AMD is going to have a spectacular quarter, and most investors would be looking at that rather than the 1 time charges/credits for the IPO.

Glad to see the IPO is complete. This should lift some concern to AMD investors who thought the IPO might not go through. I don't think the low pricing is much of a concern to AMD investors. I expect AMD to be up tomorrow on this news. The path is clear for a run up into the Q4 earnings announcement.

The impression I´m getting from that is that the "other" "loss" could actually be higher this quarter than it was last quarter.

That was kind of my impression too. Although I think they may realize this bonus expense is too big in terms of ratio to earnings, and they'll reset it next year.