SAN FRANCISCO -- Shares of
Advanced Micro Devices
(AMD - Get Report)
hit a multi-year low Wednesday, as economic concerns spread through the chip sector.
AMD's stock was down as much as 6.7% to $10.52 at one point Wednesday, breaching its 52-week low of $11.18. The last time AMD's stock traded at a lower level was on Aug. 23 2003, when it hit $10.24.
The selloff came on a down day for the broader markets, with the
Dow Jones Industrial Average
both in retreat.
American Technology Research analyst Doug Freedman said chip companies carrying large loads of debt on their books are particularly suffering in the current environment.
With the credit market tightening, there are concerns about the ability of highly leveraged companies to weather a downturn in the economy, Freedman explained.
He pointed out that
(MU - Get Report)
, which has roughly $2 billion in long-term debt, is experiencing similar treatment on Wall Street. Shares of Micron were down 4%, or 35 cents, at $8.18 in midday trading Wednesday, setting a new 52-week low for the second consecutive day.
It didn't help that a note from Morgan Stanley on Tuesday reportedly characterized Micron shares as "dead money" and initiated coverage of the chipmaker with an underweight rating.
AMD has $5.3 billion in long-term debt on its balance sheet, much of it acquired as a result of its 2006 acquisition of Canadian graphics chip company ATI.