Oversold shares of Advanced Micro Devices (AMD) appear to have caught strong support at $156. From here, we’d like to see a near-term test of $180, which would refill its bearish gap.
Helping, strong earnings from Taiwan Semiconductor are giving a boost to AMD and other chip stocks. Thanks to the artificial intelligence boom, TSM said net revenue jumped 36% year over year to $23.5 billion. Its gross margin jumped 57.8% from 54.3%.
The company also said, “Based on the current business outlook, we expect for our fourth-quarter revenue to be between $26.1 billion and $26.9 billion, which represents a 13% sequential increase or a 35% year-over-year increase at the midpoint,” TSMC Chief Financial Officer Wendell Huang said, as quoted by CNBC.
All of which is solid news for the chip sector.
Even better, analysts at TD Cowen told investors to “ignore the noise” with AMD.
“We see a healthy setup for AMD, with Datacenter now able to drive upside after being masked by downside in other segments,” said TD Cowen. “We believe the fundamental setup into 2H24 and 2025 is strong, driven by growth of the MI300/325/350 product cycles, modest upside potential in core server-CPUs, favorable PC seasonality near term, and big enough cuts to embedded/gaming.”
Sincerely,
Ian Cooper
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