AMD Stock

[yadge]

I know this thread probably doesn't belong here... but I don't know where else to put it.

I'm 17 and I'm thinking about starting some long term investing for retirement or whatever. It's never really to early to start saving. And right now would be the best time to buy some stock with long term goals in mind. Stock prices have plummeted recently, and while I might lose some money at first, in the long term I should make some money.

So I was thinking about buying some AMD stock, which is currently at $2.15. My question is if this is too risky? Do you guys think AMD will be going bankrupt anytime soon?

And I just don't know a whole lot about stocks. Like if another company buys AMD, will my stock still be valid? And even though I'm only 17, I'm fairly knowledgeable and have had stock before, but I just want to make sure I understand all of the risks before I start buying some stock.

Thanks to all who reply.

 

[blackpanther26]

AMD is not going anwhere fast if that is what you want to know.

 

[Lee-m]

Do you guys think AMD will be going bankrupt anytime soon?

no chance. AMD will still be alive kicking after your gone...

Like if another company buys AMD...

I dont think any one company had deep enough pockets to even think about it.
AMD bought ATI not so long ago.

 

[TechnologyCoordinator]

If they go bankrupt you will get NONE of your money back. If they return to profitability the stock price will probably double, quadruple, or perhaps go even high in a matter of a year or two of the return to profitability.

I would like more at long-term investing in something with tax advantages, like a 401k or something like that.

 

[yadge]

Ok guys, thanks for all the information.

 

[spathotan]

If they go bankrupt you will get NONE of your money back. If they return to profitability the stock price will probably double, quadruple, or perhaps go even high in a matter of a year or two of the return to profitability.

I would like more at long-term investing in something with tax advantages, like a 401k or something like that.

The 401k's at my work dropped by about 19% last year. I dont think the people that have been investing in it for 20+ years will agree that that is a sound investment. 401ks are a scam unless you play it extremely conservative....but then your better off with just a simple high interest savings account. The money in that savings account wont just dissapear because of a bad economy.

 

[werxen]

or it will disappear very quickly... depends how bad the economy really is

 

[spathotan]

FDIC...

 

[MarkG]

FDIC...

Only have enough money to pay out about 1% of deposits; OK if a small bank goes bust by itself, but useless in a systematic collapse.

Sure, you'd probably get your money back in twenty years, but by then $100,000 will buy you a cup of coffee.

 

[yadge]

Yeah, my dad just lost a bunch of money in his 401k. When I have a career I'm sure I'll do the whole 401k thing. But there's nothing wrong with side investments.

 

[werxen]

that better be the best damn coffee in the universe

 

[Just_An_Engineer]

The 401k's at my work dropped by about 19% last year.

I would have been happy if mine only dropped 20%. The company that manages our 401k plan had the brilliant idea of making 90% of our investment options be comprised solely of financial company stocks. As a result the average decrease in value was 40+% for us.

 

[fazers_on_stun]

no chance. AMD will still be alive kicking after your gone...

I dont think any one company had deep enough pockets to even think about it.
AMD bought ATI not so long ago.

No chance? Many financial analysts would beg to differ with you . AMD's fate is pretty much in the hands of Abu Dhabi, Intel, IBM and others, not its own.

AMD still owes over $5B on the ATI purchase, so the killer debt would be what deters a buyout unless AMD does go bankrupt and defaults. Then a company could step in and buy up the pieces it wants at rock-bottom prices since the debtors already got screwed.

AMD has about 640M shares of common stock issued, but dunno how much is voting stock. If 100% of it was, then it would only take 321M shares at $2.15 per to get 51% control, vote out the Board and install your own. In other words, Bill Gates could buy 10 AMDs and not break a sweat . If so, I would hope he'd fire Hector Ruiz at least 10 times over...

 

[fazers_on_stun]

To the OP: I suggest you start reading the financial news such as MSN Money - it's a quick and simplistic start but they have the occasional good story in there. For example, I saw one recently about how the oil stocks were depressed, with light sweet crude trading under $40 a barrel or thereabouts for the last 4 months. Oil is a pretty much non-renewable resource, and once the world economy picks up, it's like to double or triple again with the US, China and India bidding up the price. Since the new US administration just delayed the offshore drilling and western reserve leases, it's a cinch the US won't be adding much to the world's supply in the next 15 years or so.

So you could possibly double or triple your investment in a couple of years - not a bad return on an essentially safe investment.

OTOH, AMD is pretty risky. For one thing, tomorrow I think they will get another stockholder vote on the Abu Dhabi fab spinoff and issuing more stock, which will dilute prices even further. And some analysts don't think AMD will be around a year from now, if the economy doesn't pick up soon.

 

[xx12amanxx]

AMD is a long term 1-3 year investment...And you can rest assured they will not go out of business anyone who say's otherwise has no idea what they are talking about.

AMD is considered a national security and our goverment wont let them die off to be sold to the hounds from all corners of the globe. Our goverment doesnt want that kind of technology in the hands of just anyone.

I would say invest something small maybe a $100 becuase you have to remember that every sector in the tech segment is way down! AMD has lost less compared to other companies like Sony and SM radio for example. When the economy turns around ALOT of stocks will skyrocket some will improve by over ten fold!

Even if AMD's stock were to go up to an easy $10 a share in a year and a half and you originally paid $2 for a share and bought 50 shares you just made $500!

Remember it's times like now that people will make vast fortunes when this economy turns around its those smart people who can see ahead and tell what will double triple or more.

 

[yomamafor1]

Personally I think you should invest in a market that is actively growing (green energy, medical), not in a saturated market. AMD in this case is pretty much trapped in a saturated market, and facing a formidable opponent. Given that AMD's current portfolio does not include a strong mobile platform, I would highly recommend staying out of AMD's stock. But of course, if you're looking for short term gain (<1 year), you can invest in AMD's stock, and make a 30~50% gain when the market comes back.

 

[TechnologyCoordinator]

The 401k's at my work dropped by about 19% last year. I dont think the people that have been investing in it for 20+ years will agree that that is a sound investment. 401ks are a scam unless you play it extremely conservative....but then your better off with just a simple high interest savings account. The money in that savings account wont just dissapear because of a bad economy.

20+ years.....

1989 - Dow 2,000
2009 - Dow 8,000

Not too shabby, but what is even better is if you were to look at it when the dow when it was 14,000, that's a HUGE gain. Only a fool would have most of his money in stocks at or near retirement.

Putting all your money on one stock, especially one like AMD is foolish. I live in Detroit and I know too many old farts that worked for GM or Ford that had nothing but their pension and a ton of stock in their former automotive company, FOOLISH!

401k's offer tax benefits and long term growth. If you are planning for retirement, this needs to be heavily considered. You can't just take the worst case scenario (2008 stock declines) and use that to declare 401ks as poor investment tools.

I actually made money on my 401k that I started last year because my employer matches 25% of what I put in (and also because I had no money it before feb of 2008).

Just about everyone dealing with stocks has lost money in the last year. 401ks allow you to invest long term with tax benefits in a large mix. Companies such as fidelity allow you to get in funds with a target retirement date, and the closer you get to the retirement date the "safer" the investment mix gets.

 

[itadakimasu]

At around $2.00-$2.50 per share currently... its hard to say it's not a great investment opportunity. I bought in around $4.50 because that sounded like a great deal at the time LOL.

I sold all my shares, then it dropped some more and I bought in and picked up an additional 50 or so shares. I think the market is going to settle down eventually. As a first time stock buyer, it hasn't been the best experience. I picked the wrong time to start playing in the stock market since its really volatile right now. UP, Down, UP, Down.

I don't think AMD is going anywhere though. They make a good product, and lets not forget they own ATI which as far as I'm concerned is at the top of the graphics game.

If I'm on a budget for a build, I'm going AMD all the way. I decided I was pretty much wasting my Q9450 system I had, so I parted it out and went w\ an AMD 6000+ w\ 8gb ram, an hd3870, and 2 raptor's, total downgrade cost for the ram, cpu and motherboard was $170, sold most of my other components for around $650. Computer runs like a dream.

 

[fazers_on_stun]

AMD is a long term 1-3 year investment...And you can rest assured they will not go out of business anyone who say's otherwise has no idea what they are talking about.

Since AMD has lost a total of several billions of dollars over the last 9 straight quarters, has seen its cash/liquid assets drop $800M in 2008 to just $1.1B, is struggling under the $5B debt from buying ATI, and has its CPU marketshare drop from 22% to 19.3% according to IDC, and with Q1 and Q2 2009 prospects looking even bleaker, AMD is at best a risky gamble. Abu Dhabi has already 'renegotiated' the buyout deal once in December, giving AMD some $160M less; they could easily do that again or cancel it outright due to their economy hurting in the global financial crisis.

AMD is considered a national security and our goverment wont let them die off to be sold to the hounds from all corners of the globe. Our goverment doesnt want that kind of technology in the hands of just anyone.

Have you been watching the stimulus package negotiations in Congress? Taxpayers are fed up with the gov't bailouts, assuming that is what you mean. I seriously doubt any elected official would propose a bailout for a company that has been seriously mis-managed as AMD has the past few years, ever since Ruiz took over.

Remember it's times like now that people will make vast fortunes when this economy turns around its those smart people who can see ahead and tell what will double triple or more.

All the OP has to do is check similar AMD business threads here from 18 months ago, when AMD stock was still above $14, and note all the "experts" advising to buy, buy, buy if it went below $14. They pointed to the historical high of $40 and indicated it was just a matter of time before AMD's stock price would return to the glory days. Funny how none of those posters are around now...

My feeling is that AMD will make it only if the Abu Dhabi deal goes through, which also depends on Intel not yanking the x86 license.

 

[yomamafor1]

 

[Just_An_Engineer]

My feeling is that AMD will make it only if the Abu Dhabi deal goes through, which also depends on Intel not yanking the x86 license.

Technically you don't even need an x86 license. The licensing period for patents only runs for 20 years and this period has long since passed for the original x86 instruction set which has been around since the late 70's. What is currently part of the convoluted cross-licensing agreements are the myriad of modifications to the instruction set (x86-64,MMX, SSE, 3DNOW, etc.) that have been patented by both Intel and AMD over the years. It's a situation where Intel holds the rights to some of the intellectual property AMD needs and vice-versa. Theoretically Intel could decide to withhold a license for MMX and SSE in order to hamstring AMD, but that would likely result in AMD withholding a license for x86-64 which would similarly cripple Intel.

 

[mcx2500]

The best time to buy stocks is when the majority has stampeded out of the
market. There are a lot of companies at historic lows and this is one of the
several opportunies you will have in a lifetime.

Keep in mind that about 90% of your market investments should be in
companies with good histories and past earnings. The other 5%-10%
can be in more speculative stocks like AMD and other companies. This
is a pretty volatile market but as CNBC has reported, there are signs of
a gradually upturn in the economy and if there is a credible resolution to
the credit and mortgage situation the bulls are going to run over the bears.

 

[enigma067]

If they go bankrupt you will get NONE of your money back. If they return to profitability the stock price will probably double, quadruple, or perhaps go even high in a matter of a year or two of the return to profitability.

I would like more at long-term investing in something with tax advantages, like a 401k or something like that.

http://www.youtube.com/watch?v=Z1EJKifq6JM&feature=related


AMD is forward thinking.

Intel isn't making any effort to top this system or match the price/power ratio AMD has.

Cinema 2.0 is going to change Hollywood and gaming. There's a lot of money to be made there.

 

[alpine18]

I had some extra cash laying around making something like 0.001% in my IRA. So I bought 1000 shares of AMD just for fun a couple weeks ago @2.11. I think that AMD stock will be more in the 4-5 range in 6-8 months. Not wonderful, but good enough if you are in at 2 bucks.

I did buy some AMD earlier in the year @5, the luckily dumped it @6 before it slid. Even if they are losing cpu chip share to INTC, they still have ATI which is still producing products that are competitive with NVDA.

 

[jimmysmitty]

I have to agree with TC, BTW its been a while.

A company can make a lot of things and hell they bought ATI yes. But that means nothing if they do not make money. Hell Ford makes cars. In fact a lot of their newer cars are damn good cars. But are they making money? No. So their stock goes down, they have to cut jobs and hope they break even soon enough to stay in business or get the Government to bail them out.

thats just an example BTW. ATI itself is not enough to keep AMD afloat. They need more. They need to start producing more and more chips. As many as they can to sell as fast as they can. Hell the server market is still theirs. I would hope they would be focusing all of their efforts on that since it wont be long until Intel releases Core i7 into the server market with a much faster QPI and quad channel DDR3. And since we don't fully know what it can do there they should be worried as thats their main money maker.

If they lose that they wont do much better sooner unless they find a way to open up another big market and keep that as a good cash influx.

but chances are that they don't currently have th resources to open up anything else since most of their cash goes towards paying ATI off.

Overall though since I do not think that AMD will dissapear I think its current price would make it a decent buy as would buying Intel or any other stocks that have lost a lot and stableized.

Oh an one more thing, technically since the FAB deal went through no AMD does not make anything in house much like the GPUs never were. So pretty much now AMD is a CPU designing company with another FAB to produce them.