Analysts at two different firms took aim at the chip industry Monday, Oct. 1, but the targets are reacting completely differently in trading.
Baird analyst Tristan Gerra sees weakness in AMD's graphic cards business for at least another two quarters, tempering some of the optimism that has surrounded the stock in the wake of rival Intel's own shortage in central processing units.
"We think most good news are already priced in," Gerra wrote. "We believe expectations and valuation are high, prompting our downgrade."
Wall Street seems to disagree with that assessment, at least in the short term, as the stock jumped Monday and continues its torrid pace of growth. AMD's stock has jumped more than 200% year to date.
Meanwhile, Wall Street is taking Intel's negative report more seriously.
Barclays analyst Blayne Curtis sees Intel as the loser of a price war in the chip sector that is on the horizon. Curtis sees Intel having to cut prices or lose market share if it hopes to compete in an environment like that.
Intel is still positive for the year, rising about 3%, but it has been steadily outpaced by the wider S&P 500, which has gained nearly 11% year to date.
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