Value
2.3/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 0.0 |
| P/S | 0.0 |
| Fwd P/E | 2.7 |
| PEG | 5.7 |
| Analyst target | 3.0 |
- ▸Forward P/E: 42.0x
- ▸PEG: 1.34
- ▸Expensive valuation
AMD · Why this verdict
Why Advanced Micro Devices (AMD) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score6.2/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Advanced Micro Devices is generating revenue growth of 38% year over year with a perfect four-quarter earnings beat streak and strong cash conversion, but trades at a demanding forward P/E of 37.5x with weakening price momentum and persistent insider selling — the risk/reward is favorable at 1.31-to-1 but the setup does not yet warrant a high-conviction entry.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The company is generating revenue growth of 38% year over year, a strong expansion rate that supports the growth-oriented investment thesis and the premium multiple the stock currently commands. Growth breakdown | Revenue growth sustains above 25% year over year for the next 4 quarters, confirming the trajectory. | — |
| CounterThe 38% growth rate is priced in at a forward P/E of 37.5x with an 'Expensive valuation' flag; any deceleration — even to still-strong levels — may be sufficient to compress the multiple significantly given how much growth expectation is already embedded in the price. | ||
At a forward P/E of 37.5x with an 'Expensive valuation' flag, the stock demands significant future growth delivery to justify the current price; while the PEG of 1.12 is less alarming in the context of 38% growth, the multiple leaves limited room for execution misses. Valuation breakdown | The valuation looks more reasonable if the forward multiple contracts toward 28x as earnings grow into the current price. | — |
| CounterA PEG of 1.12 suggests the multiple may be close to fair value if the 38% growth rate persists; a multiple that screens expensive in absolute terms can be justified if the underlying growth premium is sustained. | ||
The company has beaten consensus EPS estimates in each of the past four quarters, with the most recent beat at approximately 6% and the prior quarter at approximately 16%, demonstrating a sustained pattern of delivering above expectations. Earnings | EPS surprise remains positive for at least 3 of the next 4 quarters. | — |
| CounterThe most recent beat of approximately 6% was narrower than the prior quarter's 16% — a narrowing trend that, if sustained, may signal expectations are catching up to delivery capacity and reducing the beat buffer available at future prints. | ||
Price momentum is weak, with falling on-balance volume signaling distribution even as the stock trades above its 200-day moving average — a divergence suggesting sellers are more active than buyers in the near term. Momentum breakdown | Momentum recovers within 12 months as on-balance volume shifts from distribution to accumulation. | — |
| CounterThe semiconductor cycle peak has been assessed as clear, suggesting no structural cycle headwind; distribution periods in cyclically sensitive names can reverse quickly when the underlying data cycle turns supportive. | ||
Insiders have net-sold approximately 345,000 shares over the past 90 days across 47 sell transactions with zero buy-side activity, representing a consistently bearish insider signal with no offsetting insider demand. Insider | Insider selling decelerates meaningfully, with net shares sold over any 90-day window falling below 50,000, reducing the directional signal. | — |
| CounterIf the company continues to beat earnings expectations as it has over the last four quarters, fundamental momentum may outweigh the directional signal from insider selling; net selling does not by itself determine whether the stock advances or declines. | ||
The company is generating revenue growth of 38% year over year, a strong expansion rate that supports the growth-oriented investment thesis and the premium multiple the stock currently commands.
—Growth breakdown
- Expectation
- Revenue growth sustains above 25% year over year for the next 4 quarters, confirming the trajectory.
CounterThe 38% growth rate is priced in at a forward P/E of 37.5x with an 'Expensive valuation' flag; any deceleration — even to still-strong levels — may be sufficient to compress the multiple significantly given how much growth expectation is already embedded in the price.
At a forward P/E of 37.5x with an 'Expensive valuation' flag, the stock demands significant future growth delivery to justify the current price; while the PEG of 1.12 is less alarming in the context of 38% growth, the multiple leaves limited room for execution misses.
—Valuation breakdown
- Expectation
- The valuation looks more reasonable if the forward multiple contracts toward 28x as earnings grow into the current price.
CounterA PEG of 1.12 suggests the multiple may be close to fair value if the 38% growth rate persists; a multiple that screens expensive in absolute terms can be justified if the underlying growth premium is sustained.
The company has beaten consensus EPS estimates in each of the past four quarters, with the most recent beat at approximately 6% and the prior quarter at approximately 16%, demonstrating a sustained pattern of delivering above expectations.
—Earnings
- Expectation
- EPS surprise remains positive for at least 3 of the next 4 quarters.
CounterThe most recent beat of approximately 6% was narrower than the prior quarter's 16% — a narrowing trend that, if sustained, may signal expectations are catching up to delivery capacity and reducing the beat buffer available at future prints.
Price momentum is weak, with falling on-balance volume signaling distribution even as the stock trades above its 200-day moving average — a divergence suggesting sellers are more active than buyers in the near term.
—Momentum breakdown
- Expectation
- Momentum recovers within 12 months as on-balance volume shifts from distribution to accumulation.
CounterThe semiconductor cycle peak has been assessed as clear, suggesting no structural cycle headwind; distribution periods in cyclically sensitive names can reverse quickly when the underlying data cycle turns supportive.
Insiders have net-sold approximately 345,000 shares over the past 90 days across 47 sell transactions with zero buy-side activity, representing a consistently bearish insider signal with no offsetting insider demand.
—Insider
- Expectation
- Insider selling decelerates meaningfully, with net shares sold over any 90-day window falling below 50,000, reducing the directional signal.
CounterIf the company continues to beat earnings expectations as it has over the last four quarters, fundamental momentum may outweigh the directional signal from insider selling; net selling does not by itself determine whether the stock advances or declines.
Per-dimension breakdown
Quality
6.8/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.7 |
| ROA | 2.4 |
| Gross margin | 6.6 |
| Op margin | 5.8 |
| Net margin | 6.7 |
| Current ratio | 9.2 |
| FCF quality | 9.8 |
| Moat | 7.9 |
| Piotroski F | 10.0 |
- ▸Excellent cash conversion: 143% FCF/NI
- ▸Wide economic moat
- ▸Strong Piotroski F-Score: 9/9
Growth
10.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
| EPS growth | 10.0 |
- ▸Strong growth: 38% YoY
Momentum
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 0.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 1.5 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 7.1 |
| Analyst rating | 9.0 |
| Price target | 4.1 |
- ▸LLM news sentiment: +0.43 (n=5)
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Insider selling (low materiality) — $163,737,577 (0.018% of mkt cap)
- ▸Institutions accumulating
Peer rank
5.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 1.8 |
| quality rank | 5.4 |
| growth rank | 6.8 |
Technical
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 3.2 |
| support resistance | 4.1 |
| 52w position | 8.7 |
| gap | 3.0 |
- ▸Extreme gap up (6.1%) - may pull back
Risk (lower is worse)
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.7 |
| days to cover | 9.7 |
| volatility | 0.0 |
| put call | 7.9 |
| implied vol | 0.0 |
| beta | 1.8 |
| debt equity | 9.8 |
| news risk | 6.0 |
- ▸High IV: 85%
- ▸Concentration risks: 1 HIGH, 2 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 5.5 |
| news activity | 8.0 |
- ▸Strong earnings: 3B/0M
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (5)
- MOMENTUM:5.2>=4.5
- INSIDER:OK
- EARNINGS_PROXIMITY:23d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.0=NEGATIVE
Warning (2)
- MOMENTUM:5.2<5.5 (soft — BUY_NOW allowed but watch)
- 8K_FLAG:1.02
Reward-to-Risk
-0.96
Upside
-13.4%
Downside
13.9%
Sizing output
AVOID
SetupRange Bound — RSI 55 mid-range, Bollinger mid-band
EdgeCatalyst-Driven — Earnings in 23d with 3/4 beat streak
SuitabilityAggressive — Beta 2.47>1.3
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:5.2>=4.5. Top dim: Growth at 10.0; weakest: Value at 2.3. No conviction either direction.
The strongest dimensions are Growth at 10.0, Insider at 7.3, and Sentiment at 6.9; the weakest are Value at 2.3, Technical at 4.8, and Peer rank at 5.1. The V9 engine flagged 1 failed gate with 2 warnings, producing an asymmetric reward-to-risk of -0.96 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Strong 38pct Revenue Growth
Trip ifRevenue growth falls below 20% YoY for 2 consecutive quarters.
- P2Consistent Earnings Beat Streak
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P3Expensive Valuation Limits Entry
Trip ifForward P/E compresses below 28x from the current 37.5x for 2 consecutive quarters.
- P4Volume Distribution Momentum Weakness
Trip ifPrice breaks above $535 for 5 consecutive trading sessions.
- P5Persistent Insider Selling Signal
Trip ifNet insider purchases exceed 50,000 shares over a 90-day period.