In the past year, a number of semiconductors have experienced dazzling gains thanks to the current euphoria surrounding artificial intelligence (IA). The course of the action of Nvidia,, Manufacture of Taiwan semiconductorsAnd Broadcom have all increased by around 80% in the last 12 months – easily surpassing both S&P 500 And Nasdaq Composite.
But a name in the field of the chip which simply does not seem to call on investors is Advanced micro-apparents(Nasdaq: AMD)whose shares have dropped 36% in the past year.
Below, I will analyze the report on the results of the fourth quarter and the year entirely entirely in the year. Although the results can be a little difficult to navigate, I see a lot of potential in the long -term AMD roadmap. I will explain how the company makes notable breakthroughs in the field of AI Buy the dip In stock AMD.
I think that the surface explanation on the reasons for which actions such as Nvidia or Taiwan have regularly increased in the past year is due to the fact that the business results of each company accelerate all levels. It is generally a good recipe for arouing the enthusiasm of investors.
Conversely, the AMD financial profile was more difficult to assess. Among its four operational segments, two develop spectacularly … and two decelerating at alarming rates. For this reason, the overall growth rates of AMD seem quite common compared to its chip peers.
For all 2024, AMD revenues increased by 24% while net profit increased by 42%. It is a respectable image, but when you consider that the Integrated games and segments Recalled by 59% and 13%, respectively, it is difficult not to wonder what AMD would look like if all its large companies were in a position of strength.
Although I understand this point of view, I think it’s short -sighted. Remember that the semiconductor industry is quite cyclical. For this reason, it is not uncommon for a company such as AMD attending reflux and circulating in certain categories of exploitation. For me, the real concerns should be to know if the company’s long -term story seems robust or weak.
Image source: Getty Images.
The area on which I personally focus on most AMDs is its data center activity. This is part of the company that has provided advanced chipware known as graphic processing units (GPU) in data centers. For most of the past two years, Nvidia has been the main player in the city with regard to GPUs in the data center.
However, a more in -depth analysis of AMD’s financial results suggests that the company makes significant full -fledged progress. In 2024, the activity of the AMD data center generated $ 12.6 billion in sales – up 94% from one year to the next. Even better? The operating benefits in this unit have almost tripled. To put this in perspective, the activity of the AMD data center increased only 7% from one year to the next in 2023 and operating profits actually fell by more than 30%. It is a whole reversal in just a year.
So what has changed? AMD published its MI300X accelerators in December 2023. This product served as a pivot change for AMD, because the company now has a GPU which can compete more directly with those provided by Nvidia – and all at a reduced cost.
In the past year, AMD has been pierced with tastes Microsoft,, Meta-platformsAnd OracleProvide each of these companies with MI300 chipe software in addition to their existing NVIDIA hardware battery. Recent comments made by Microsoft and Meta leadership strongly imply that investment in AI infrastructure is very planned to continue, and I consider these commitments as a positive force for the DMLA.
At present, AMD is negotiating at a prices for term (p / e) multiple remuneration of 24, which is essentially the same as the means of the S&P 500. I see parity between these multiples as a Suggestion that investors consider a position in AMD as carrying the same advantage as simply to pour your money into a index according to the S&P 500.
In light of the expansion market myriad under the umbrella of AI, combined with the importance of fleas play in the food of these applications, it is difficult to justify an investment in AMD as being equal to the market with the market wider. When you consider how speed has the company has set its data center activity, I become even more optimistic about AMD’s potential to disturb players like Nvidia at the bottom of the road.
I now see as an excellent opportunity to buy the DIP, to put my fist, in AMD stock and to prepare to hold in the long term.
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Randi Zuckerberg, former Director of Development of the Facebook and Sister of the CEO of Meta Platforms, Mark Zuckerberg, is a member of the board of directors of Motley Fool’s. Adam Spatacco has positions in Meta, Microsoft and Nvidia platforms. The Motley Fool has positions and recommends advanced micro-apparements, Meta, Microsoft, Nvidia, Oracle and Taiwan Semiconductor Manufacturing platforms. The Motley Fool recommends Broadcom and recommends the following options: Long January 2026 395 $ calls Microsoft and short January 2026 405 $ calls Microsoft. The Word’s madman has a Disclosure policy.
