Advanced Micro Devices (AMD) Stock Gains on Q2 Earnings, Revenue Beat

Advanced Micro Devices (AMD) stock is trading higher this morning after reporting second-quarter earnings and revenue ahead of analysts' estimates.
By Rachel Graf ,

NEW YORK (TheStreet) -- Shares of Advanced Micro Devices (AMD) - Get Report are surging 9.20% to $5.70 on heavy trading volume Friday morning after reporting better-than-expected financial results for the 2016 second quarter.

The Sunnyvale, CA-based semiconductor company reported an adjusted loss of 5 cents per share on $1.03 billion in revenue vs. analysts' estimates of a loss of 8 cents per share on $951.3 million in revenue.

For the current quarter, Advanced Micro Devices said it expects revenue to increase about 18% sequentially to $1.21 billion.

Canaccord Genuity reiterated a "buy" rating and hiked its price target to $6.50 from $6 following the results. 

"While we recognize that roadmap execution, competition and financial risks remain, we remain impressed with the new management team and our estimates assume only modest share recovery in core markets that should yield material upside to consensus and a quick recovery to solid profitability given lower expenses necessitated by the company's recent struggles," the firmwrote in a note released this morning. 

But Pacific Crest contended that upside will depend on improved PC demand, GPU and CPU share gains from Polaris and Zen or more IP licensing deals with customers. 

About 52.6 million shares of Advanced Micro Devices have been traded so far today, well above its average trading volume of roughly 26.52 million shares per day.

Separately, TheStreet Ratings team rates the stock as a "sell" with a ratings score of D.

AMD's weaknesses include its declining revenues.

You can view the full analysis from the report here: AMD

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author.

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