Business Is Better, but AMD Shares Struggle

Long pegged as an also-ran, Advanced Micro Devices(AMD Quote) should now be able to preen a little. The chipmaker finally turned a hard-won quarterly profit, and its server chip has made some high-profile inroads into a market dominated by Intel (INTC Quote).

But investors aren't ceding the company one iota of credit. After falling 62 cents Wednesday, the stock has lost 23% since hitting a near-term peak of $18.29 in mid-November; in the same period, the benchmark Philadelphia Stock Exchange Semiconductor Index is down 6.2%.

"If you look at volume and interest and price direction, what it's telling you about AMD today is the good news has already been discounted," declared Robert Bacarella, manager of the (MSCEX Quote)Monetta Select Technology fund, which recently sold its AMD stake. ...