Followers | 679 |
Posts | 141044 |
Boards Moderated | 36 |
Alias Born | 03/10/2004 |
Tuesday, May 03, 2022 2:25:10 PM
By: TheStreet | May 3, 2022
• The two semiconductor companies have the opportunity to dispel doubts about their growth.
Advanced Micro Devices (AMD) and Nvidia (NVDA) pass a crucial test in this month of May.
The two chipmakers have experienced hell on the stock market since the beginning of the year.
Worried about global growth, investors have fled tech and semiconductor and microprocessor makers in particular, despite seemingly solid fundamentals.
The reason? A lack of chips to manufacture their products.
This is the case in the automotive sector as well, where manufacturers have had to halt the assembly of certain models for lack of parts. Electronics, IT and other industries have also suffered, as they scramble for the right materials.
This chip crisis is expected to last until at least 2024, industry sources say. However, semiconductor manufacturers did not take advantage of the earlier boom times, thus ending the golden period of 2021.
Sharp Drop in AMD and Nvidia Stocks
AMD shares are down 37.1% since Dec. 31. In the first quarter of 2022, AMD shares fell 24.01%.
As for Nvidia shares, the decline is 33.6% since December and 28.4% for the first quarter completed on March 31.
AMD shares are trading at the time of writing at $90.50, down from $143.90 on Dec. 31.
The current Nvidia stock price is $195.33 versus $294.06 on Dec. 31.
Nvidia, AMD and Intel sell graphics processing units and CPUs to gamers.
They are also prominent producers of semiconductors and systems for application in cloud servers, self-driving cars, the metaverse, artificial intelligence and more.
After months of uncertainty, the two companies will publish their quarterly results this month.
AMD kicks off May 3 at the close. Investors will then wait for May 25 to find out how Nvidia performed in the first quarter of its fiscal year 2022.
Analysts predict that AMD will report a substantial increase in profit and revenue, but at a slower pace than in past years. Analysts estimate EPS of $0.91 vs. $0.52 in Q1 FY 2021. Revenue is also expected to grow.
But investors want to know about AMD's growth plans. The company announced in April the acquisition of Pensando Systems Inc., a provider of networking and security services, for $1.9 billion.
This transaction is expected to give AMD an advantage in the data center sector, a high-growth market.
"The Pensando team brings world-class expertise and a proven track record of innovation at the chip, software and platform level which expands our ability to offer leadership solutions for our cloud, enterprise and edge customers," Lisa Su, AMD chair and chief executive officers, said in a press release.
Pensando’s products are already deployed at scale across cloud and enterprise customers, including Goldman Sachs, IBM Cloud, Microsoft Azure and Oracle Cloud.
Will a Good Surprise Be Enough?
Investors also want to scrutinize the Enterprise, Embedded and Semi-Custom segment, which includes server and embedded processors rather than processors for desktops and laptops.
This division is expected to continue to grow. Any sign of a slowdown is likely to heighten investor fears.
AMD has managed in past quarters to pleasantly surprise investors. It is possible that this time even a good surprise is not enough given the context.
Demand is likely to be hurt by rising concerns about recession and the prospect that consumers will cut spending and reduce purchases, observers say.
That's particularly possible since during the pandemic, consumers and companies bulked up on tech tools, particularly PCs.
These sources suggest that factors portend a downturn in the PC market. In general, many investors are betting on a slowdown in hardware sales in 2022 and 2023.
Nvidia is the chip maker that could be the most affected by these growth fears, because it generates much of its sales from video gaming rigs.
Analysts believe the company could be hit hard once households pare back purchases.
Investors are also linking Nvidia's future to changes in the crypto space, especially in the ethereum blockchain.
Ethereum in June is supposed to be moving to a new version and a new transaction validation mechanism that will change the way the native cryptocurrency of this platform, ether, is minted.
The change is likely to reduce the number of GPUs used to create ether, and GPUs are one of Nvidia's cash cows.
Read Full Story »»»
DiscoverGold
Information posted to this board is not meant to suggest any specific action, but to point out the technical signs that can help our readers make their own specific decisions. Caveat emptor!
• DiscoverGold
Recent AMD News
- Easing Worries About Possible Rate Hike May Generate Buying Interest • IH Market News • 05/02/2024 01:06:30 PM
- U.S. Stocks Close Mixed Following Post-Fed Volatility • IH Market News • 05/01/2024 08:35:00 PM
- AMD Reports First Quarter 2024 Financial Results • GlobeNewswire Inc. • 04/30/2024 08:15:11 PM
- U.S. Index Futures Point to Mild Decline Ahead of Key Earnings and Fed Rate Decision • IH Market News • 04/30/2024 11:59:59 AM
- United Shares Surge 5.3% in Q1 2024 Earnings Beat; Take-Two Cuts 5% of Workforce, and More News • IH Market News • 04/17/2024 10:57:39 AM
- AMD to Report Fiscal First Quarter 2024 Financial Results • GlobeNewswire Inc. • 04/16/2024 08:15:00 PM
- AMD launches AI chips for business laptops and desktops • IH Market News • 04/16/2024 02:43:08 PM
- AMD Expands Commercial AI PC Portfolio to Deliver Leadership Performance Across Professional Mobile and Desktop Systems • GlobeNewswire Inc. • 04/16/2024 01:00:00 PM
- Paramount Global Board Shrinks, Morgan Stanley Faces Regulatory Probe, and More News • IH Market News • 04/12/2024 11:05:29 AM
- Delta Generates US$37 Million Profit in Q1, Google and Intel Unveil Cutting-Edge AI Chips, and More News • IH Market News • 04/10/2024 11:13:48 AM
- AMD Extends Leadership Adaptive SoC Portfolio with New Versal Series Gen 2 Devices Delivering End-to-End Acceleration for AI-Driven Embedded Systems • GlobeNewswire Inc. • 04/09/2024 08:15:00 AM
- AMD Recommends Rejection of “Mini-Tender” Offer from Tutanota LLC • GlobeNewswire Inc. • 04/01/2024 08:15:00 PM
- U.S. Stocks May Move Back To The Upside In Early Trading • IH Market News • 03/26/2024 01:09:44 PM
- U.S. Index Futures on the Rise, Oil Prices Show Stability • IH Market News • 03/26/2024 11:21:42 AM
- U.S. Stocks Show Modest Move To The Downside • IH Market News • 03/25/2024 08:44:00 PM
- Tech Sector Weakness May Weigh On Wall Street • IH Market News • 03/25/2024 01:26:54 PM
- AMD Adaptive Computing Technology Powers Sony Semiconductor Solutions LiDAR Automotive Reference Design • GlobeNewswire Inc. • 03/19/2024 01:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/11/2024 08:22:08 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 03/08/2024 10:23:51 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 03/07/2024 10:59:11 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/07/2024 09:14:43 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/07/2024 09:09:41 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/06/2024 09:09:18 PM
- AMD Extends Market-Leading FPGA Portfolio with AMD Spartan UltraScale+ Family Built for Cost-Sensitive Edge Applications • GlobeNewswire Inc. • 03/05/2024 02:00:00 PM
- AMD Hits Regulatory Roadblock, GitLab’s Stock Tumbles on Disappointing Earnings, and Latest News • IH Market News • 03/05/2024 11:05:08 AM
NanoViricides Reports that the Phase I NV-387 Clinical Trial is Completed Successfully and Data Lock is Expected Soon • NNVC • May 2, 2024 10:07 AM
ILUS Files Form 10-K and Provides Shareholder Update • ILUS • May 2, 2024 8:52 AM
Avant Technologies Names New CEO Following Acquisition of Healthcare Technology and Data Integration Firm • AVAI • May 2, 2024 8:00 AM
Bantec Engaged in a Letter of Intent to Acquire a Small New Jersey Based Manufacturing Company • BANT • May 1, 2024 10:00 AM
Cannabix Technologies to Deliver Breath Logix Alcohol Screening Device to Australia • BLO • Apr 30, 2024 8:53 AM
Hydromer, Inc. Reports Preliminary Unaudited Financial Results for First Quarter 2024 • HYDI • Apr 29, 2024 9:10 AM