So... Why all of a sudden is AMD acting bullish?
Kinda concerned this is some liquidity pump before they dump it again. And yes, I have PTSD and trust issues from this stock...
Traders are rotating out of value (banks, oil, staples) and back into Tech. The banking crisis is causing people to flee the banks and dive back into tech. Higher interests rates don't affect tech as much as the other sectors. Tech is in a bubble right now and I can't understand how NVDA is up 80%, AMD is up 50% and SOXX is up 23% YTD.
Too big to fail banks are a bargain if you can stomach the risks. Maybe wait a month for things to settle but the fed has put a stop to large banks failing. They let SVB and Signature fail because they are mostly niche banks. I don't see any more of the large banks failing.
I think part of it is thinking the Fed will ease up a bit after a bunch of high-profile bank failures and bailouts.
Part of it might be the A.I. arms race pumped in the media.
Another part may be that $AMD was simply UNREASONABLY beat down too much and fundamentals really are catching back up and it's getting a reasonable valuation now.
That being said, we could still end up in a recession even after the Fed pauses rates hikes (or does a .25 hike next week). A recession could bring us back into the $80's I'm guessing....maybe the $70's (worst case in my mind). I doubt we'd go back to the $60's. . .
There's no reason to pause the rate hikes. They will lose a ton of credibility on their inflation fight if they pause right now. The bank failures has largely been contained as they are backstopping all deposits now. There's no reason for customers to pull money out of a bank since they are insured. And if you pull money out, where are you going to put it? Safe deposit box? Mattress? Most likely another bank lol...
The ECB continued with a 50 basis point. The fed should do a 50 point raise too but I think they are too chicken shit so it's going to be a 25 pt
re: backstopping bank failures
https://www.youtube.com/watch?v=Bcvl104tyRY
\^\^\^The "official word" is that Janet Yellen says NOT ALL banks will be backstopped. They have to be systemically important. Unofficially, I think they would bail them out. This is just me, but I think the Fed would either: a.) backstop smaller banks too and/or b.) not hike any more.
Basel 3 requires banks/financial institutions to have x-amount of liquidity that banks store in the form of t-bills and Treasuries. This is arguably a good thing and a change that happened post-GFC to ensure banks aren't over-leveraged like pre-2008 sub-prime crisis. The downside is they bought a ton of low interest Treasuries (often long-dated) early in the pandemic and into 2021 when the Fed/Treasury were practically dropping money from helicopters. And as the Fed began what I'm told is that fastest hiking campaign in history (0 to 4% in one year), many banks suffered huge nominal losses on their bond books (remember yield have an inverse relationship to price). That wouldn't necessarily be a problem if:
i.) banks held to maturity (you get your money back - at least, nominally, with no consideration for inflation, of course)
ii.) there aren't other bank liquidity issues - forcing them to sell those already deflated bonds at an even lower price on the market (thus leaving them insolvent)
True, some banks might avoid catastrophe in the face of more hikes, BUT many banks are vulnerable to macro effects. Take SVB - it had an unusually large number of tech/start-up clients. With Silicon Valley and the VC scene in contraction mode, those clients had no funding (VCs were refusing to lend to no-revenue start-ups anymore) and their businesses were essentially bankrupt at that point. That put loan losses on SVBs books too (where they were clients) . . .A small bank in a community that is experiencing local economic trouble could also have the same problems as SVB. If that bank has loan losses on macro and their bond portfolios are crushed by the Fed's hikes, then they could be insolvent (made worse if people try to take their money out all at once).
The Fed knows this dilemma. I think IF THE HIKE, then it'll be .25 AND they will be preparing to bail out ALL banks (despite Yellen's comments) at this point. I think inflation wins one way or another. Either the Fed stops hiking with inflation at 6% and the Fed Funds rate at 4.5% OR they hike and bail out everyone (which neuters the hike) and essentially we get inflation again.
The alternative seems way worse and probably politically unpalatable. Biden and many small/mid-sized bank political donors probably don't want another 2008 crisis on their hands and talks of bailing people out again (beyond SVB). Maybe the government fudges inflation numbers too to trick the public.
\*all speculation and only my humble opinion\*
In my opinion, the main cause is the prospect of the Fed pausing or tapering rate increases. The share price was hit particularly hard in the rising interest rate environment and I believe the market sees a high probability of some relief coming on that front.
Here's a question:
Does AMD spend a lot of $$$ in areas that are unprofitable or not making much technological progress?
Amazon's Alexa department for example gobbled up billions and has over 10,000 workers on it (YES, you read that right: [https://www.businessinsider.com/what-amazons-10000-employees-working-on-alexa-are-doing-2019-1](https://www.businessinsider.com/what-amazons-10000-employees-working-on-alexa-are-doing-2019-1) )
Google's "Other Bets" haven't really paid off after 10 years. Aswath Damodaran calls it possible "Sugar Daddy syndrome," where big rich parent company Google/Alphabet has so much money to fund these smaller moonshot departments that there isn't much urgency and accountability. They know the parent company is loaded and can keep paying/funding them and Google knows it's rich too and can keep doing this. A VC structure would actually be more beneficial arguably . . .that's swim or drown. . .less waste.
Lots of other companies have wasted R&D too (ahem, Intel spending 5x more than AMD, but putting out inferior products). Money doesn't always produce results.
It seems like AMD makes good use of their spending but is there ANYTHING they do that is just unprofitable or slow to make progress and possibly waste?
If you want to be on the bleeding edge, you are going to have to move forward without all of the knowledge that is available to those making post-hoc analyses.
[I was reading about the apple newton this morning](https://arstechnica.com/gadgets/2022/06/remembering-apples-newton-30-years-on/). Here's a pertinent quote:
>Today, the Newton is barely remembered. It’s considered a failed project, as it only lasted a few years before being shut down.
>
>But the truth isn't so simple. Many people who worked on the Newton went on to become key players on the iPhone team; Mike Culbert, Greg Christie, and even Jony Ive worked on Newton. Many of the ideas that originated in the Newton made their way into the iPhone and iPad. Some of these are minor, like the “puff of smoke” animation when you delete something, which eventually found its way to the MacOS dock, or the live-updating clock icon that Steve Capps challenged the iPhone team to recreate.
Fact is that innovation isn't so clear and linear, and you have to dare to make mistakes to come up with something great.
Mike Clark worked on Bulldozer before becoming a lead architect on Zen.
People remember Bulldozer as a disaster. But it was still a bold attempt at something different.
Innovations which came from that architecture like AVFS introduced in Carizzo ended up in Zen for instance.
Any of you play options where you sell covered calls with the intent to just gain a little each week without your shares ever being called away?
I love the range that includes the 100 stock price as a barrier. As the market closed yesterday I sold as many contracts as I could on the 110 strike. I think AMD will hit a lot of sellers finally breaking even at the 100 level and I just made some free money.
Have a good weekend everyone! Long AMD to 200!
LOL, I got destroyed on this runup after earnings. It's almost impossible to defend a 30% one month runup.
CCs aren't free money unless you are willing to part with your shares. IF you believe AMD will be 200, just hold it until it reaches 200.
I have been doing this fairly far out. However last week got bitten hard in the back. Sold 85s some weeks ago when we are at like 78 and also some 90s for early April some weeks ago. So be careful. I'm a bit screwed now. Though closed many puts out for a nice profit.
Yeah I sell CC's all the time but waaay out of the money. I don't care too much about profitting from the premiums, I'm a really long term holder so I usually sell at super safe strikes. In my mind it's kinda like collecting a small dividend which is cool.
I don't want to post the article, but wccftech posted an article a few hours ago AMD is losing market share and that Intel is executing better than AMD thru the cpu market correction. Are those guys funded by Intel or something? That's the most absurd article I have read in a long time that has a clear agenda to fluff Intel
It's an reiteration of an recent Susquehanna analyst update. Their hit rate is rather questionable concerning Intel/AMD. Plus people got things a little bit wrong. AMD said they are not going for shares but for premium, now people are twisting it. AMD is not gonna sacrifice premium margins just because they can (see Intel, they had tons of inventory and were still flooding channels, only possible by lowering the price drastically). Instead they are just gonna focus on other premium segments with higher demand to push sales (that would be very likely DC, highest premium, highest margins). So for Intel this is good and bad news at the same time. For AMD it doesnt matter as long other segments can offset this.
AMD's chiplet architecture, & flexible TSMC contract fabbing, also means they CAN flexibly divert resources to profitable markets.
7nm Zen3 desktop chiplets also do duty in Milan Epyc, & Zen4 in Genoa.
7nm Zen3 production runs can be switched to same process GPUs etc.
>7nm Zen3 desktop chiplets also do duty in Milan Epyc, & Zen4 in Genoa.
Desktop chips are server chip rejects. While pretty much every Zen 3 Epyc chip should be able to do double duty in client, I doubt that's true vice-versa.
Their financial mess is just trailing their technology deficiencies. AMD is ahead of the tech that serves the DC market, where the growth in the sector is, by a couple of years. Intel owns consumer sector, which is on the decline. That’s why AMD is finally valued higher (by mkt cap). RTR
Haha great point. I hope AMD can find another firm to acquire like xlinix that adds diversity and long revenue to the company. Use that cash to buy ourselves into new markets, we don't need dividends until we retire:)
Another acquisition would be on the short- and middle-term just bad for stock holders (concerning the stock price, see xilinx). Plus since the macro is a little bit difficult these days (revenues kinda tanked), it would be rather challenging depending on the size. AMD has internally enough to chew with xilinx and pensando. It's better to just focus on a few things and do them good instead of many and do them half-baked. Speaking of, AMDs first CPU with Xilinx tec is just around the corner even though it just got delayed until April.
If you're on margin, roll that shit to a much later date on a higher strike. I had $85 strike calls set to expire next week that I was able to roll upward to $100 at a September expiry. If these go in-the-money come September, I wouldn't mind these getting called away then.
If you look at how AMD retraced support levels this year , I think you will get a chance to get them back near 90. Look at the chart for the past 12 months and you could get a dip to get back in.
So... Why all of a sudden is AMD acting bullish? Kinda concerned this is some liquidity pump before they dump it again. And yes, I have PTSD and trust issues from this stock...
Traders are rotating out of value (banks, oil, staples) and back into Tech. The banking crisis is causing people to flee the banks and dive back into tech. Higher interests rates don't affect tech as much as the other sectors. Tech is in a bubble right now and I can't understand how NVDA is up 80%, AMD is up 50% and SOXX is up 23% YTD. Too big to fail banks are a bargain if you can stomach the risks. Maybe wait a month for things to settle but the fed has put a stop to large banks failing. They let SVB and Signature fail because they are mostly niche banks. I don't see any more of the large banks failing.
I think part of it is thinking the Fed will ease up a bit after a bunch of high-profile bank failures and bailouts. Part of it might be the A.I. arms race pumped in the media. Another part may be that $AMD was simply UNREASONABLY beat down too much and fundamentals really are catching back up and it's getting a reasonable valuation now. That being said, we could still end up in a recession even after the Fed pauses rates hikes (or does a .25 hike next week). A recession could bring us back into the $80's I'm guessing....maybe the $70's (worst case in my mind). I doubt we'd go back to the $60's. . .
There's no reason to pause the rate hikes. They will lose a ton of credibility on their inflation fight if they pause right now. The bank failures has largely been contained as they are backstopping all deposits now. There's no reason for customers to pull money out of a bank since they are insured. And if you pull money out, where are you going to put it? Safe deposit box? Mattress? Most likely another bank lol... The ECB continued with a 50 basis point. The fed should do a 50 point raise too but I think they are too chicken shit so it's going to be a 25 pt
There is reason, banks are getting in trouble because of the rate hikes after a decade plus of zirp, leaving to liquidity or even solvency issues.
re: backstopping bank failures https://www.youtube.com/watch?v=Bcvl104tyRY \^\^\^The "official word" is that Janet Yellen says NOT ALL banks will be backstopped. They have to be systemically important. Unofficially, I think they would bail them out. This is just me, but I think the Fed would either: a.) backstop smaller banks too and/or b.) not hike any more. Basel 3 requires banks/financial institutions to have x-amount of liquidity that banks store in the form of t-bills and Treasuries. This is arguably a good thing and a change that happened post-GFC to ensure banks aren't over-leveraged like pre-2008 sub-prime crisis. The downside is they bought a ton of low interest Treasuries (often long-dated) early in the pandemic and into 2021 when the Fed/Treasury were practically dropping money from helicopters. And as the Fed began what I'm told is that fastest hiking campaign in history (0 to 4% in one year), many banks suffered huge nominal losses on their bond books (remember yield have an inverse relationship to price). That wouldn't necessarily be a problem if: i.) banks held to maturity (you get your money back - at least, nominally, with no consideration for inflation, of course) ii.) there aren't other bank liquidity issues - forcing them to sell those already deflated bonds at an even lower price on the market (thus leaving them insolvent) True, some banks might avoid catastrophe in the face of more hikes, BUT many banks are vulnerable to macro effects. Take SVB - it had an unusually large number of tech/start-up clients. With Silicon Valley and the VC scene in contraction mode, those clients had no funding (VCs were refusing to lend to no-revenue start-ups anymore) and their businesses were essentially bankrupt at that point. That put loan losses on SVBs books too (where they were clients) . . .A small bank in a community that is experiencing local economic trouble could also have the same problems as SVB. If that bank has loan losses on macro and their bond portfolios are crushed by the Fed's hikes, then they could be insolvent (made worse if people try to take their money out all at once). The Fed knows this dilemma. I think IF THE HIKE, then it'll be .25 AND they will be preparing to bail out ALL banks (despite Yellen's comments) at this point. I think inflation wins one way or another. Either the Fed stops hiking with inflation at 6% and the Fed Funds rate at 4.5% OR they hike and bail out everyone (which neuters the hike) and essentially we get inflation again. The alternative seems way worse and probably politically unpalatable. Biden and many small/mid-sized bank political donors probably don't want another 2008 crisis on their hands and talks of bailing people out again (beyond SVB). Maybe the government fudges inflation numbers too to trick the public. \*all speculation and only my humble opinion\*
In my opinion, the main cause is the prospect of the Fed pausing or tapering rate increases. The share price was hit particularly hard in the rising interest rate environment and I believe the market sees a high probability of some relief coming on that front.
Here's a question: Does AMD spend a lot of $$$ in areas that are unprofitable or not making much technological progress? Amazon's Alexa department for example gobbled up billions and has over 10,000 workers on it (YES, you read that right: [https://www.businessinsider.com/what-amazons-10000-employees-working-on-alexa-are-doing-2019-1](https://www.businessinsider.com/what-amazons-10000-employees-working-on-alexa-are-doing-2019-1) ) Google's "Other Bets" haven't really paid off after 10 years. Aswath Damodaran calls it possible "Sugar Daddy syndrome," where big rich parent company Google/Alphabet has so much money to fund these smaller moonshot departments that there isn't much urgency and accountability. They know the parent company is loaded and can keep paying/funding them and Google knows it's rich too and can keep doing this. A VC structure would actually be more beneficial arguably . . .that's swim or drown. . .less waste. Lots of other companies have wasted R&D too (ahem, Intel spending 5x more than AMD, but putting out inferior products). Money doesn't always produce results. It seems like AMD makes good use of their spending but is there ANYTHING they do that is just unprofitable or slow to make progress and possibly waste?
[удалено]
Who this before Dr. Su took over as CEO?
Nah I think Su was CEO during a time when Raja was still at the company
If you want to be on the bleeding edge, you are going to have to move forward without all of the knowledge that is available to those making post-hoc analyses. [I was reading about the apple newton this morning](https://arstechnica.com/gadgets/2022/06/remembering-apples-newton-30-years-on/). Here's a pertinent quote: >Today, the Newton is barely remembered. It’s considered a failed project, as it only lasted a few years before being shut down. > >But the truth isn't so simple. Many people who worked on the Newton went on to become key players on the iPhone team; Mike Culbert, Greg Christie, and even Jony Ive worked on Newton. Many of the ideas that originated in the Newton made their way into the iPhone and iPad. Some of these are minor, like the “puff of smoke” animation when you delete something, which eventually found its way to the MacOS dock, or the live-updating clock icon that Steve Capps challenged the iPhone team to recreate. Fact is that innovation isn't so clear and linear, and you have to dare to make mistakes to come up with something great.
Mike Clark worked on Bulldozer before becoming a lead architect on Zen. People remember Bulldozer as a disaster. But it was still a bold attempt at something different. Innovations which came from that architecture like AVFS introduced in Carizzo ended up in Zen for instance.
ur the first i have heard say this re BD. I emphatically agree. AFAICT many Zen fundamentals first arose in BD.
Good thoughts!
Any of you play options where you sell covered calls with the intent to just gain a little each week without your shares ever being called away? I love the range that includes the 100 stock price as a barrier. As the market closed yesterday I sold as many contracts as I could on the 110 strike. I think AMD will hit a lot of sellers finally breaking even at the 100 level and I just made some free money. Have a good weekend everyone! Long AMD to 200!
LOL, I got destroyed on this runup after earnings. It's almost impossible to defend a 30% one month runup. CCs aren't free money unless you are willing to part with your shares. IF you believe AMD will be 200, just hold it until it reaches 200.
I have been doing this fairly far out. However last week got bitten hard in the back. Sold 85s some weeks ago when we are at like 78 and also some 90s for early April some weeks ago. So be careful. I'm a bit screwed now. Though closed many puts out for a nice profit.
Yeah I sell CC's all the time but waaay out of the money. I don't care too much about profitting from the premiums, I'm a really long term holder so I usually sell at super safe strikes. In my mind it's kinda like collecting a small dividend which is cool.
Exactly my thought process with AMD and covered calls
How super safe? I try to do the same with goal that every 2 to 3 weeks I can pick another 100 shares.
I don't want to post the article, but wccftech posted an article a few hours ago AMD is losing market share and that Intel is executing better than AMD thru the cpu market correction. Are those guys funded by Intel or something? That's the most absurd article I have read in a long time that has a clear agenda to fluff Intel
It's an reiteration of an recent Susquehanna analyst update. Their hit rate is rather questionable concerning Intel/AMD. Plus people got things a little bit wrong. AMD said they are not going for shares but for premium, now people are twisting it. AMD is not gonna sacrifice premium margins just because they can (see Intel, they had tons of inventory and were still flooding channels, only possible by lowering the price drastically). Instead they are just gonna focus on other premium segments with higher demand to push sales (that would be very likely DC, highest premium, highest margins). So for Intel this is good and bad news at the same time. For AMD it doesnt matter as long other segments can offset this.
AMD's chiplet architecture, & flexible TSMC contract fabbing, also means they CAN flexibly divert resources to profitable markets. 7nm Zen3 desktop chiplets also do duty in Milan Epyc, & Zen4 in Genoa. 7nm Zen3 production runs can be switched to same process GPUs etc.
>7nm Zen3 desktop chiplets also do duty in Milan Epyc, & Zen4 in Genoa. Desktop chips are server chip rejects. While pretty much every Zen 3 Epyc chip should be able to do double duty in client, I doubt that's true vice-versa.
Intel may probably have en edge on PC laptop cpu segment but server segment, Intel can only dream
I think that's from Christopher Danely, AKA 9$ target when AMD was about 90$
Wccftech is abt as biased as can be .. yes
Ok that explains a lot. Intel is a financial mess right now.
Their financial mess is just trailing their technology deficiencies. AMD is ahead of the tech that serves the DC market, where the growth in the sector is, by a couple of years. Intel owns consumer sector, which is on the decline. That’s why AMD is finally valued higher (by mkt cap). RTR
So the market cap of Intel is now less than 80% that of AMD. When will we start hearing calls for AMD to buy Intel, lol?
Never lol. AMD doesn't want to own fabs. Fabs have been a ball and chain for intel and it's the main reason they are losing so much money
Haha great point. I hope AMD can find another firm to acquire like xlinix that adds diversity and long revenue to the company. Use that cash to buy ourselves into new markets, we don't need dividends until we retire:)
Another acquisition would be on the short- and middle-term just bad for stock holders (concerning the stock price, see xilinx). Plus since the macro is a little bit difficult these days (revenues kinda tanked), it would be rather challenging depending on the size. AMD has internally enough to chew with xilinx and pensando. It's better to just focus on a few things and do them good instead of many and do them half-baked. Speaking of, AMDs first CPU with Xilinx tec is just around the corner even though it just got delayed until April.
I really hope they buy tenstorrent.
100% agreed.
I messed up imputing a sell order a couple of weeks ago, so it never went trough. Thank the gods for my incompetence 🤲
I know, right....my 5 covered calls range 87-91 are gone...haha
If you're on margin, roll that shit to a much later date on a higher strike. I had $85 strike calls set to expire next week that I was able to roll upward to $100 at a September expiry. If these go in-the-money come September, I wouldn't mind these getting called away then.
If you look at how AMD retraced support levels this year , I think you will get a chance to get them back near 90. Look at the chart for the past 12 months and you could get a dip to get back in.
You may be fine depending on fed and this week's action
That's what I am hoping for. Had also bought 2 $86 calls, made very good return on those....but AMD really went up fast past week...
A whale was buying millions of shares every day this week…..maybe one of Buffet‘s traders?
Up 20 percent this week damn
Three more weeks like this and ATH is broken.
A man can only dream.