CSCO CEO comments fails to help AMD


  • AMD sinks 4.5% on Thursday.
  • Russia-Ukraine tensions return on Thursday.
  • Cisco CEO says not sure when chip supply shortfall ends.

Advanced Micro Devices (AMD) sank another 4.5% on Thursday after Russia-Ukraine tensions reemerged as a cause of concern and US economic reports scared investors. The CEO of Cisco made headlines when he refused to give a timeline on when the global chip shortage would end. AMD shares are up 1.7% in Friday’s premarket to $114.30.

Advanced Micro Devices Stock News: Cisco CEO says no end in sight for chip shortage

Cisco (CSCO) CEO Chuck Robbins told analysts over a conference call on Wednesday that there was no end date from his vantage point to the ongoing chip shortage that began in 2021. 

“I wouldn’t say we have a great timeline for you as to when things begin to improve. All we know now is we expect this to be with us through the second half of our year,” Robbins said.

These comments were even more strenuous than comments on Tuesday by AMD’s CEO, Lisa Su. In Su’s interview with Yahoo Finance on Tuesday, Su said she did not expect the chip supply shortage to end in 2022, but she did say the situation would improve in the second half of 2022.

Continued supply constraints should keep prices elevated in the semiconductor industry throughout the year. A recent analysis of the shortage found that companies that typically held a chip inventory of 40 days prior to the pandemic had seen this fall to just five days in the past year.

On Monday AMD completed the Xilinx acquisition that began in October 2020. Xilinx shareholders receive 1.7234 shares of AMD for each share of Xilinx, and Su said the deal will increase earnings in 2022.

AMD key statistics

Market Cap $135 billion
Price/Earnings 35
Price/Sales 8
Price/Book 18
Enterprise Value $132 billion
Operating Margin 22%
Profit Margin

19%

52-week high $164.46
52-week low $72.50
Short Interest 6%
Average Wall Street Rating and Price Target Buy, $153.59

Advanced Micro Devices Stock Forecast: AMD must hold $111.88 or its back to $100

With Thursday’s thorough drop, AMD stock is now near Monday’s low of $111.88. If AMD breaks lower here, then $100 is the only nearby level of long-term support. $111.88 should hold since it is in line with the 200-day moving average.

The 9-day and 21-day moving averages are both above AMD price now at $121.06 and $117.80, respectively. They are trending lower and should provide some resistance if AMD advances. February 9’s range high at $132.96 is still the upside target.

AMD 1-day chart


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