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A Rough Week: AMD Gets Six F Grades From Investors

By - Source: Navellier Ratings | B 39 comments

AMD just received a devastating certificate from the investment industry. AMD has been crowned "sell of the week" by AAII Journal as investors do not seem to have not much confidence in the company right now. Navellier Ratings has given AMD another downgrade from "sell" last week to "strong sell" this week as the company's financial performance was graded with six "F" performances in eight disciplines.

F grades were given in operating margin growth, earnings growth, earnings momentum, earnings surprises, analyst earnings revisions and cash flow. A "D" was given in sales growth and an "A" was given in return on equity. The good news may be that it cannot get much worse, and that financial analysts sometimes have bad days as well and tend to be extremely moody. Some good news that is thrown in with the bad could upgrade AMD to a sell next week again.

Of course, this financial analyst reaction was to be expected after the rather sobering Q2 earnings result and the fact that the company has made mistakes in mismatching channel and OEM supply of its processors, ending up with too much supply in the channel.

There is surely some time left for AMD to improve, but it more and more seems as if the introduction of Windows 8 will be a make or break time for Rory Read's strategy to lead AMD away from the processor chase with Intel and into a much more consumer-oriented space.

 

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  • 30 Hide
    vilenjan , July 25, 2012 11:04 PM
    This is terrible, if AMD goes, than it back Intel/Nvidia monopoly :( 
  • 19 Hide
    K2N hater , July 25, 2012 11:36 PM
    Investor news are meant to mislead the masses so the elite may get higher margins.

    AMD isn't in a good shape right now but we know that's got to be a window of opportunity to the gamblers out there.
  • 17 Hide
    Raid3r , July 25, 2012 11:09 PM
    Don't get caught up in the reindeer games.
Other Comments
  • 30 Hide
    vilenjan , July 25, 2012 11:04 PM
    This is terrible, if AMD goes, than it back Intel/Nvidia monopoly :( 
  • 17 Hide
    Raid3r , July 25, 2012 11:09 PM
    Don't get caught up in the reindeer games.
  • 11 Hide
    Anonymous , July 25, 2012 11:33 PM
    it needs to drop to $1 then i can go buy some shares and wait for it to go up again. I dont see them going under anytime soon.
  • 19 Hide
    K2N hater , July 25, 2012 11:36 PM
    Investor news are meant to mislead the masses so the elite may get higher margins.

    AMD isn't in a good shape right now but we know that's got to be a window of opportunity to the gamblers out there.
  • 6 Hide
    debs3759 , July 25, 2012 11:51 PM
    "investors do not seem to have not much confidence"

    I always liked AMD in the past. I hope they can recover from their recent problems and start innovating again with new technologies that others will want to follow.
  • 13 Hide
    nforce4max , July 26, 2012 12:06 AM
    I hope that the company does not fail, I would gladly support if they decided to team up with VIA to get some of their IP and try to make something better than the two have to offer alone.

    AMD is being mismanaged intentionally so that maybe it could be bought up or go under leaving Intel with almost total market share while it is anyone's guess what will happen to the graphics division. I hope that Intel or Nvidia doesn't get to buy it like what happened to 3DFX.

    Going and doing everything half ass in the IT world doesn't work very well if at all for long.
  • -8 Hide
    akamrcrack , July 26, 2012 12:25 AM
    Inb4 government bailout


    This is a buyers market, if AMD goes under there will be no choices E.G. Intel would monopolize E.G. we don't let things like that happen.

    Albeit that the choices we have aren't very different, especially considering the gpu market.


    When did the world turn into a place where everything has competition, but still manages to look/feel/walk/quack like a duck I already own.

    AMD vs Nividia arguement used to be "AMD has eyefinity, Nvidia has 3D" now its "AMD has 3 games, Nvidia has better pricing" lol they went from innovation to price fixing..

    Honestly, I think the whole pc market just needs a catalyst to really kick start innovation again. The catalyst being a 3rd CPU manu (perhaps IBM) and a 3rd GPU manu.
  • 9 Hide
    aicom , July 26, 2012 12:43 AM
    AMD is not being mismanaged. It is generally not the direction I would like to see it going, but I would argue that the management is doing the best with what AMD has. Keep in mind that Intel has a massive R&D department that has functioning silicon with features that a production CPU won't get for at least 2 years. AMD doesn't have nearly the R&D (in the CPU department), so it's going to play the roll of the company that will design a custom APU/CPU/SoC that will meet certain needs using either an x86 or ARM core. It will take advantage of the Radeon IP it has and integrate a Radeon core in the APU/SoC. Intel will be ahead in the CPU performance game, but AMD has decided to play the SoC designer game in the long run and it seems to be profitable for companies like Qualcomm
  • 6 Hide
    sinfulpotato , July 26, 2012 12:43 AM
    I would buy AMD stock if it tanked. I remember when AMD was much much cheaper.. Ups and downs.
  • 3 Hide
    southernshark , July 26, 2012 1:08 AM
    vilenjanThis is terrible, if AMD goes, than it back Intel/Nvidia monopoly


    Na if AMD goes under the ATI component will be sold off. The CPU division will get bought up too, hopefully by Nvidia.
  • -4 Hide
    southernshark , July 26, 2012 1:12 AM
    aicomAMD is not being mismanaged.... It will take advantage of the Radeon IP it has and integrate a Radeon core in the APU/SoC. Intel will be ahead in the CPU performance game, but AMD has decided to play the SoC designer game in the long run and it seems to be profitable for companies like Qualcomm


    Totally disagree. On its current track Intel will destroy AMD in 1 or 2 gens. There is no way Trinity can compete with Haswel. Even if the GPU ends up being a little better, the superiority of the Intel CPU will still crush it.

    AMD needs to think about selling the company now while they can still get 10 bucks a share (in a sale) versus nothing on the courthouse steps.

    And hey I'm actually a big AMD fan, use its chips in all my comps, but I just don't see how it can survive, especially since R&D was cut in favor of a "middle path" which is never going to pan out.
  • 5 Hide
    jimmysmitty , July 26, 2012 1:24 AM
    K2N haterInvestor news are meant to mislead the masses so the elite may get higher margins.AMD isn't in a good shape right now but we know that's got to be a window of opportunity to the gamblers out there.


    But the sad thing is that AMD as a company to invest in is not in the best position right now, they have also gone through most of the team of people who have made them what they are in many areas.

    I fear that AMD losing its upper management might lead AMD into a direction where Intel has no true competition and we wont see the same innovation but instead just a stagnating CPU market that Intel will dominate.
  • 5 Hide
    Anonymous , July 26, 2012 2:00 AM
    AMD should diversify into smartphone processors
  • 4 Hide
    Anonymous , July 26, 2012 2:35 AM
    Well, Putting the name FX on the Bulldozer cpu is or would be like Ford Motor Co. putting the name Cobra or Boss on the Pinto.
  • -7 Hide
    f-14 , July 26, 2012 2:40 AM
    in the era of mobile how mobile are those i5's and i7's?
    amd is going the most profitable route as non mobile is shrinking faster than the titanic sank, it just happens to be a much bigger ship that holds more than 10's of millions of people, that takes time to sink.
    AMD decided not to compete for the high power market that will shrink considerably and not show growth like mobile. i agree with
    K2N haterInvestor news are meant to mislead the masses so the elite may get higher margins.AMD isn't in a good shape right now but we know that's got to be a window of opportunity to the gamblers out there.

    AMD is competing with ARM
    if Intel represents germany( the techonological leaders) and AMD represents america (get-r-done) and ARM is the russians (limitless low cost and expense) and this is world war 2 how do you think this is going to go down? (locations of this analogy are ironic)
  • -1 Hide
    joejamesatou , July 26, 2012 2:59 AM
    This is what happens when you can't sell a single desktop CPU for over $200. Until they can they will continue to lose money. It's sad but true. And when investors stop investing it only gets harder. They don't have the R&D budget. They fall another process behind Intel. Unless they can pull a rabbit out of the hat it is going to be a slow death for their CPU business.

    That said I love the 7870 I picked up! At least they can still make a good return on the 78xx and 79xx. It's sad when they have 4 graphics cards that are more expensive than their highest desktop enthusiast CPU. They just need to focus on what they do best. Maybe they can still save the GPU biz.
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