Even better, AMD has a super-competitive product line-up that could command a larger market share. Advanced Micro Devices has turned into a big winner, even during COVID. That’s a commendable accomplishment.
Should you be interested in this stock? Well, the sales and revenue data says it could be a miracle 2021 for the company.
AMD Stock and Ground-breaking Products
The first thing to know about AMD is the company has a good line of performance-enhanced products. Let’s take a look at their 2021 and 2022 product range.
First, their Ryzen CPU is wildly popular and continues to drive revenue. It’s even been called the “fastest mainstream-platform gaming CPU” ever. AMD reported high Q3 revenue in part because of Ryzen’s increase in sales. The product has made AMD a leader in desktop CPUs and gives it a significant advantage in the market.
Even better, the Ryzen 5000 line has hit huge performance gains, with a 19% increase in instructions per cycle. This has led AMD to show big performance improvements in video editing, gaming and computer-aided design with these new CPUs. And what’s more, they have made significant achievement with their “ultrathin” 4000 series and their Radeon RX 6000 series GPUs.
As AMD leads, Intel (NASDAQ:INTC) is losing its grasp on the market thanks to being out-performed and its inability to meet consumer demand. Even Apple (NASDAQ:AAPL) is abandoning Intel. All the while, in the PC market, AMD has a healthy share of around 20% and that share is increasing. Plus, Microsoft (NASDAQ:MSFT) has requested AMD increase their production to meet demand for its newest Xbox consoles. Due to this, it is expected that revenue will be even better for AMD in Q4.
Finally, the company just made a deal to buy Xilinx (NASDAQ: XLNX), a top provider in the enterprise computing industry. This acquisition has increased AMD stock and will let them move into industries like aerospace and defense.
Strong Numbers Drive Their Stock Price
With their products performing at industry-leading levels, the company’s numbers have unsurprisingly been great. With Q3, revenues hitting $2.8 billion, which is a 56% year-over-year (YOY) increase.
Also, operating income hit $449 million (up an amazing 141% from $186 million) and net income hit $390 million (up 225% from $120 million). Finally, diluted EPS increased from 11 cents to 32 cents. And cash equivalents hit $1.77 billion for the quarter.
So AMD is doing very well. But there’s more to come. For this past quarter, the company anticipates a 41% increase on revenues and a 41% increase for the year overall. And that will mean to a quick increase in EPS. Plus, AMD has a large free cash flow margin which leads to significant investment in capital and higher rewards for shareholders.
So, the stock is absolutely a good long-term investment. With an amazing line of products coming soon and high performance continuing into 2021 and 2022. Based on these facts, shares could easily go past $100 in 2021.
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