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Why Tuesday Was a Very Important Day for Advanced Micro Devices, Inc. (NASDAQ:AMD)

Advanced Micro Devices, Inc. (NASDAQ:AMD) just closed up 0.52% on the most clear-cut bear pummeling the technology sector and the Nasdaq have endured since perhaps some time in the spring of 2002 – if you are thinking in terms of downside leadership as a “special” phenomenon defined by egregious underperformance of anything and everything to do with technology or the Nasdaq relative to the broad equities asset class.

This was a bear mauling of technology stocks. And AMD closed strong and ended up with a single-day annualized return of +131.04%. That’s how the stock is situated in terms of its value-response to the most bluntly bearish Nasdaq tape in years. I don’t mean to repeat myself officiously here. I’m almost trying to pummel it into my own brain for safe keeping.

Advanced Micro Devices, Inc. (NASDAQ:AMD) shares were, of course, the recipient of an improper level of excitement due to the BTC bubble and some new elements of the chip cycle that blossomed into flavorful interaction with the cloud bubble on a number of different levels.

However, in recent months, the story has dramatically corrected, with its reaction to Q3 earnings placing a capstone on the pyramid of that decline in dramatic fashion.

We wrote a piece suggesting that it may find a strong measure of support in the $16.90 area, which represented a confluence of bottoming technical potential. However, we did not necessarily expect such a follow-on drubbing to evolve in the rest of the Nasdaq after that point.

That’s the main idea here: whatever you think about AMD, you must appreciate the signal we saw on Tuesday. The tech sector got pounded and AMD shares closed materially higher on no new company news.

That is simply not something you see in a stock that is still highly vulnerable after major downside movement has already gotten traction on the chart.

Make note of it.

 

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Advanced Micro Devices, Inc. (NASDAQ:AMD) pulled in sales of $1.7B in its last reported quarterly financials, representing top line growth of 0.6%. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($1.1B against $1.9B, respectively).

The company bills itself as a semiconductor company worldwide. It operates in two segments, Computing and Graphics; and Enterprise, Embedded and Semi-Custom.

The company’s products include x86 microprocessors as an accelerated processing unit (APU), chipsets, discrete and integrated graphics processing units (GPUs), and professional GPUs; and server and embedded processors, and semi-custom System-on-Chip (SoC) products and technology for game consoles.

It provides x86 microprocessors for desktop PCs under the AMD Ryzen, AMD Ryzen Pro, Threadripper, AMD A-Series, AMD E-Series, AMD FX CPU, AMD Athlon CPU and APU, AMD Sempron APU and CPU, and AMD Pro A-Series APU brands; microprocessors for notebook and 2-in-1s under the AMD Ryzen processors with Radeon Vega GPUs, AMD A-Series, AMD E-Series, AMD C-Series, AMD Z-Series, AMD FX APU, AMD Phenom, AMD Athlon CPU and APU, AMD Turion, and AMD Sempron APU and CPU brands; and microprocessors for servers under the AMD EPYC and AMD Opteron brands. It also offers chipsets under the AMD brand; discrete GPUs for desktop and notebook PCs under the AMD Radeon and AMD Embedded Radeon brand; professional graphic products under the AMD Radeon Pro and AMD FirePro brands; and customer-specific solutions based on AMD’s CPU, GPU, and multi-media technologies.

In addition, it provides embedded processor solutions for interactive digital signage, casino gaming, and medical imaging under the AMD Opteron, AMD Athlon, AMD Sempron, AMD Geode, AMD R-Series, G-Series, and AMD Embedded Radeon brands; consumer graphics under the AMD Radeon brand; and semi-custom SoC products.

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