Advanced Micro Devices (NASDAQ:AMD), a leading semiconductor company worldwide is expected to release its first-quarter 2022 earnings on Apr. 25-29. This news will move AMD stock and will set probably a new trend. Will this trend be a bullish one? The odds point to this direction based on the history of AMD’s beating estimates.
Shares of AMD trade closed at $103.72 on April 7, and one specific price level to monitor is the psychological one of $100 a share. Why? Round numbers tend to act as magnets for building positions near them, either for support or resistance to stock prices. To be more precise, I would add that specifically the $102 price level is one to watch for AMD stock. It has bounced off the point at least three times in 2022.
Once on Jan. 27, twice on March 7, and a third time on Mach 14. It seems that when AMD stock is approaching the level of $102-$100 investors prefer to buy and short bounces follow.
Having this mentioned what should we expect from upcoming AMD earnings? On Yahoo Finance analysts have an average estimate of earnings per share of 91 cents and an average estimate of $5.58 billion for revenue.
On CNN Business the consensus for Q1 2022 EPS is also 91 cents with a range between $0.83-$0.96 and the consensus for the revenue is $5 billion.
Zacks Investment Research has a consensus EPS forecast for the quarter of 91 cents as well.
Taking all these estimates the comparison will be to the previous year’s figures to analyze true growth. In Q1 2021 Advanced Micro Devices reported an EPS of 52 cents and sales of $3.4 billion.
We can conclude that a strong quarter is expected for AMD, both year-over-year and probably quarter-over-quarter too. In Q4 2021 AMD reported revenue of $4,826 million and EPS of 80 cents.
Advanced Micro Devices has delivered positive EPS surprises in the past four consecutive quarters and the odds of delivering another stellar quarter are very high. Taking into consideration the strong support near $100 a share and high expectations for beating estimates investing now in shares of AMD to take advantage of a bounce higher as the earnings date is approaching could be a smart move with an increased probability of success.
On the date of publication, Stavros Georgiadis, CFA did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
