AMD Riding Intel's Coattails, but Will It Last?
Shares of Advanced Micro Devices (AMD) are up with much of the chip sector today, as investors look for ways to play Intel’s (INTC) strong results.
AMD is scheduled to report its first-quarter Thursday after the close.
Auriga USA analyst Daniel Berenbaum, though, is holding onto a Sell rating and $6 price target. He cautions investors about making assumptions about broader chip strength.
“We think this risks misinterpreting AMD’s competitive positioning. AMD has gained share in graphics from Nvidia (NVDA)–good for sales but below corporate average gross margin–but its CPU roadmap looks weak, particularly in high-ASP/high-margin servers where checks suggest that Intel’s Nehalem product continues to gain market share.”