Despite the difficult context brought by 2H22 and reflected in the PC inventory digest, Advanced Micro Devices (NASDAQ:AMD) navigated the rough terrain pretty well.
Before the chip giant’s fiscal fourth quarter income (January 31), Mizuho analyst Vijay Rakesh thinks full-year 2022 results will show 43% year-on-year growth, fueled by strong data center performance (DC), which Rakesh saw an increase of 60% over the same period. This should result in “significantly better” performance than competitor Intel with DC “potentially flat” over the same period.
In fact, after the PC challenges of the September quarter, which caused Intel to lose market share, AMD appears to have regained market share in Q4, with the explosion of the Ryzen 7000 desktop processors fueling it. increase. And while on PC the company expects another weak year (potentially down 5-10% year-over-year), Rakesh thinks AMD is “well-positioned with Ryzen products.” new and enduring trends in PC gaming.”
Going elsewhere, the 5-star analyst thinks AMD has “benefited from improving server market share and will continue to make good strides into 2023E with the highly anticipated 5nm Genoa lineup.” “. Genoa 5nm – the new line of server CPUs – will provide a “significant headwind” over Intel, given the fact that their “competitive” 10nm++ Sapphire Rapids offering won’t spread until 2H23E. There is also the expected ramp of the company’s 5nm Bergamo cloud-optimized CPU in the second half of the year.
And while the Xilinx deal, which ends in early 2022, only proves to be earnings-neutral, its planned FPGA computing roadmap offers a “compliment” to the company’s CPU roadmap. AMD.
Finally, addressing the recent announcement of the retirement of CFO Devinder Kumar – who played a key role in AMD’s strong growth – Rakesh allayed investor fears by noting that his successor Not only does Jean Hu have a technical background, but he has also served as Marvell’s CFO since 2016, having “solid CFO experience.”
Based on the above, Rakesh designates AMD as his Top Pick for 2023 and rates it as a Buy. On top of that, the 5-star analyst sets a $95 price target for AMD, implying a 26% upside potential. (To see Rakesh’s achievements, click here)
Most analysts are of the same opinion; The stock’s Strong Buy consensus rating is based on 18 Buys versus 6 Holds. The forecast calls for a 12-month gain of ~13%, considering the average target clock at $85.09. (See AMD Stock Forecast)
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Disclaimer: The opinions expressed in this article are those of the featured analyst only. Content is used for informational purposes only. It is very important that you do your own analysis before making any investment.