Chip stock Advanced Micro Devices (NYSE: AMD) has been busy announcing new partnerships along with other news as the company continues to compete with or differentiate itself from Intel Corporation (NASDAQ: INTC) and NVIDIA Corporation (NASDAQ: NVDA). I should note that recently had an open position in Advanced Micro Devices in our SmallCap Network Elite Opportunity (SCN EO) portfolio from roughly last summer up until late January when we locked in a small loss. Because the SCN EO is a trading rather than a buy and hold portfolio, we decided to get out when shares sank once more after AMD issued an earnings report – a repeat of the performance that occured after three previous earnings reports. However and if you are an investor or trader with a longer term horizon, you might want to consider the following news about AMD:
New Gaming Partnerships and Collaborations. Late last week, Advanced Micro Devices announced three new game developer partnerships with Rebellion Developments, Square Enix® and Xaviant in order to optimize PC games to make them look and run better for every gamer on AMD hardware plus the company announced another partnership with German video game developer Crytek to add native Mantle graphics API support to CRYENGINE®. Matt Skynner, the Corporate VP and GM of AMD's Graphics Business Unit, recently had a lengthy chat with a Forbes Contributor by first "preaching a message of open collaboration as opposed to competitor Nvidia"with the writer commenting: "How widely adopted Mantle becomes following this partnership is just speculation, but it's a bright spot for a technology still in its infancy." When asked about the appeal of Mantle to developers, Skynner commented:
"I think you're seeing it. Guys like Crytek, DICE, Oxide, seeing the value and supporting it. The names associated with Mantle tell the story. As general manager for AMD's graphics I'm pretty damn happy!"
Ascendiant Capital Initiates Coverage. Analyst Cody G. Acree from Ascendiant Capital has initiated coverage of AMD with a "buy" rating and a price target of $5. Acree wrote:
"While we are not expecting any singular dramatic near-term catalyst, we do see the company working through a methodic restructuring and repositioning that has already reduced spending and earned significant wins that are driving growth at Sony (SNE), Microsoft (MSFT), Verizon (VZ), Apple (AAPL) and others."
Acree noted that AMD's restructuring reduced headcount by 15% and lowered operating expenses by 26% plus he believes the company's new APU chips can help it "regain a moderate share" of the consumer PC market. On the other hand, Acree commented that he does not expect "any singular dramatic near-term catalyst."
The Next Earnings Report. Advanced Micro Devices is scheduled to next report earnings for the fiscal first quarter ending March 29, on Thursday, April 17, after the market closes. There will be an audio webcast of the teleconference over the Internet on the company's website at ir.amd.com.
Share Performance. Advanced Micro Devices is up 5.2% since the start of the year, up 59.4% over the past year and up 51.7% over the past five years while here is a look at its long term performance verses that of Intel Corporation and NVIDIA Corporation:
Finally, here is a look at the latest technical charts for all three chip stocks:
SmallCap Network Elite Opportunity (SCN EO) had an open position in AMD. To find out what other open positions SCN EO currently has, and to learn why so many traders and investors are relying on this premium subscription service, click here to find out more.
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