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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Advanced Micro Devices, Inc. (XNAS:AMD) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
AMD
Name:
ADVANCED MICRO DEVICES, INC. (XNAS:AMD)
Sector:
924.00M
Industry:
Semiconductors
CEO:
Dr. Lisa Su
Total Employees:
15,500
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -118.14% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF ADVANCED MICRO DEVICES, INC.(AMD) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SEMICONDUCTORS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
80.24
One Month Price Target:
$81.13
Six Month Price Target :
$85.58
Likely Price in One Year's Time:
Ticker:
$90.92
Likely Trading Range Today Under (Normal Volatility)
$79.9
Price Upper limit ($) :
$80.84
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$74.65
This week:
$67.74
This month :
$55.24
Other Primary facts
Market Cap:
127.08B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
1.61B
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
16.5%
-14.64%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$106.16
$94.08
$54.32
$66.40
Medium risk (<10%) entry points
Buy Call
Sell Call
$90.15
Buy Put:
Sell Put:
$87.57
$70.30
$72.91
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
AMD
Sharpe Ratio:
4.45%
Comparison:
AMD, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 43.66% higher than the industry
& ratio is 95.16% higher than the market/S&P 500 average
Average Returns/Yield of
AMD
Daily returns:
0.16%
Weekly returns:
0.82%
Monthly returns:
3.27%
Yearly returns:
31.95%
Comparison of returns:
Average annual returns/yield (last 3 years) is 22.69% above industry average
Classification:
AMD, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.59
Statistical test of Returns:
AMD has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.47%
Weekly Volatility:
7.76%
Monthly Volatility:
15.53%
Yearly Volatility:
53.79%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.51%
Volatility in last five trading days has been -85.22% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.97%
Weekly VaR:
-15.58%
Monthly VaR:
-31.16%
How Much Can the price of
AMD
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-26%
Worst case (decline):
>85%
This translates to price declining to:
$59.64
This translates to price declining to:
$12.04
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
AMD is a 119.93% riskier investment compared to the market/S&P 500 & is 88.42% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -2.16% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
AMD
Beta in relation to market/S&P 500--1.98
Expected beta in 1 year's time:
1.114
Expected beta in 3 year's time:
1.575
Unlevered (debt free) Beta:
1.925
Beta in relation to Nasdaq (XNAS):
1.42
Beta in relation to all global stocks::
0.823
Beta Comparison & Analysis
Beta of competitors/peers::
1.143
Beta is 73.30% higher than peers
Average Industry Beta:
1.41
Beta is 40.44% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
44.89%
Sustainable growth rate is 62.34% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.225
Alpha is 17.46% above industry average alpha yield
Alpha is 1431% higher than market/& is unsustainably high
Analysis of Cost of Capital of
AMD
Equity cost of capital:
0.167
Equity cost of capital is 30.50% above industry mean WACC
Unlevered (without debt) cost of capital:
16.25%
Before-tax cost of debt:
1.76%
After-tax cost of debt:
1.39%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.39%
WACC is 55.83% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$11.69
Revenue growth rate per share of (3Y):
2.34
Annual revenue growth rate is 275.21% above the industry average
EPS:
$2.68
Expected Annual growth rate of EPS (3Y):
102.39%
Expected future EPS growth rate is 96.39% higher than the Semiconductors industry
Free cash flow (FCF) per share:
$2.47
-
-
Debt per share
$1.14
EBITDA per share
$3.07
Valuation Analysis Today of
AMD
P/E Ratio:
33.74
P/E Ratio of Competitors/Peers:
23.92
P/E ratio is 41.04% higher than main peers & is -18.65% lower than the industry
Stock price/value with industry average P/E ratio: $111.16
AMD is -27.81% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
6.86
Price to sales ratio is -15.57% below the industry mean
P/B (Price to book value ratio):
2.34
Price to free cash flow: 32.51
Price to free cash flow ratio is -28.70% lower than the industry
Net income growth rate (3Y):
678.20%
Net income growth rate is -1283.98% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
3.33%
Net debt to equity ratio:
-4.67%
Debt to assets ratio:
2.76%
Net debt to assets ratio:
-3.86%
Debt-to-asset ratio is -92.93% below industry average
Ability to repay debt:
Interest coverage ratio:
130.32
Interest coverage ratio is 297.48% more than industry average
Looking forward:
Debt growth rate:
24.48%
Annual debt growth is -73% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.653
Statistical significance of correlation:
AMD has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.627
Stock price is 4.14% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.627
Correlation of price movement with Nasdaq (^IXIC):
-0.013
Covariance of price movement with the market:
-0.026
Kurtosis
1.794
Returns are more concentrated around the mean (platykurtic), compared to a normal distribution
Skewness of returns:
0.196
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
AMD
Gross Profit Margin Ratio:
194%
Operating Profit Margin Ratio:
20.86%
Operating profit margin is -11.35% lower than the industry
Net Profit Margin Ratio:
194%
Effective Tax Rate:
13.69%
Effective tax rate is -9.29% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
6.13%
Return on equity (ROE) is -78.56% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
5.07%
Return on assets (ROA) is -61.48% lower than the industry
Financial Leverage:
1.0x
Current Ratio:
2.4
Current ratio is -41.02% below industry average
Cash Conversion Cycle (days):
24.1
Cash conversion cycle is -56.24% below industry average
The remaining useful life of property plant & equipment is: 36.0 years
Stock based compensation to net income ratio:
5.87%
In-depth Efficiency Analysis
Revenue generated per employee:
1.2M
Each employee generates 97% more revenue than industry average revenue per employee
EBITDA generated per employee:
319.5K
Each employee generates 37% more EBITDA than industry average revenue per employee
Profit generated per employee:
218.9K
Each employee generates 36% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
59.6K
Each employee generates 115% more free cash flow than industry average revenue per employee
Assets/Capital per employee
3.5M
Each employee generates 115% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 43.47%
Growth rate in R&D investment/expenditure is 207.00% higher than the industry
Competitors/Peer firms of
AMD
INTUIT INC. (XNAS:INTU)
TEXAS INSTRUMENTS INCORPORATED (XNAS:TXN)
APPLIED MATERIALS, INC. (XNAS:AMAT)
MICRON TECHNOLOGY, INC. (XNAS:MU)
INTEL CORPORATION (XNAS:INTC)
LAM RESEARCH CORPORATION (XNAS:LRCX)
ANALOG DEVICES, INC. (XNAS:ADI)
ATLASSIAN CORPORATION PLC (XNAS:TEAM)
ADOBE INC. (XNAS:ADBE)
Current Analyst Ratings
Strong buy�21%
Buy�25%
Hold�63%
Sell�17%
Strong sell�4%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/26/22
Revenue:
18.88B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
9.72B
9.16B
3.30B
-
1.73B
-
202.00M
5.22B
-
38.00M
984.00M
4.95B
3.94B
3.39B
3.92B
537.00M
3.39B
Statement of Cash Flow
Date:
Period:
628.00M
Differed Income Tax :
- 342000.00K
Stock Based Compensation :
199.00M
Change in Working Capital :
- 422000.00K
Accounts Receivables:
- 672000.00K
Other Working Capital:
-
Other Non-Cash Items:
146.00M
Net Cash Provided by Operating Activities:
995.00M
Investments in PP&E:
- 71000.00K
Net Acquisitions:
2.37B
Purchases of Investments:
- 100000.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/26/22
2022
Q1
4.74B
1.79B
6.53B
3.68B
2.43B
725.00M
13.37B
1.82B
23.08B
27.35B
72.00M
32.00M
1.19B
53.55B
-
66.92B
1.48B
312.00M
-
-
3.79B
5.58B
1.85B
1.05B
6.00B
-
11.58B
16.00M
- 665000.00K
- 2000.0K
55.98B
March 26, 2022 at 6:00:00 AM
14.94B
55.33B
66.92B
1.86B
2.16B
- 2583000.0K
964.00M
- 1000.00K
3.16B
-
-
- 1949000.00K
-
1.00M
- 1948000.00K
-
2.21B
4.74B
2.54B
995.00M
- 71000.00K
924.00M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
AMD
2023
2024
2025
2026
2027
$91.37
$152.99
$173.35
$196.42
$222.57