AMD Growth Assessment Reveals Mixed Performance Indicators

AMD receives a 46% rating on growth metrics, indicating mixed performance. Key tests show strengths in revenue growth, but weaknesses in P/E ratio, EPS growth, and earnings persistence.

Date: 22-03-2025

AI Rating: 5

Overview of AMD's Performance

According to the report, Advanced Micro Devices Inc (AMD) is evaluated using the Growth Investor model, receiving a rating of 46%. This suggests that while AMD shows promise, it also faces significant challenges. Notably, a score below 80% indicates that the stock may not be on investors' high-priority lists.

Revenue Growth Highlights

AMD passes the Revenue Growth in Relation to EPS Growth criteria, indicating that the company's revenue is on an upward trajectory compared to its earnings per share (EPS). This is a positive sign for investors as it showcases the company's ability to increase sales effectively.

Weaknesses in EPS Growth

Unfortunately, AMD has several failures according to the guru strategy's tests. These include:

**P/E Ratio:** Classified as a fail, suggesting that the stock may be overvalued or not meeting growth expectations compared to its earnings.
**Positive Earnings Growth Rate for Current Quarter:** A failure here reflects potential volatility and inconsistency in earnings growth.
**Earnings Growth Rate for the Past Several Quarters:** Although AMD passes this test, the lack of consistency in current earnings growth is concerning.
**Long-Term EPS Growth:** This failure raises red flags about the company’s ability to maintain earnings growth over the long term.
**Earnings Persistence:** With a fail in this area, there may be indications of instability in earnings reports.

Overall, despite its strengths in revenue growth and some metrics indicating potential, AMD must address its weaknesses, particularly in EPS growth and valuation, to improve its attractiveness for investors.

Stocks: AMD