As long as the world needs semiconductors, graphics processing units and other hardware components, Advanced Micro Devices (NASDAQ:AMD) stock will thrive.
The company should be able to generate strong revenue and provide value to the shareholders.
AMD stock deserves a solid “B” grade even if a notable insider recently reduced her share position.
Earlier this year, the market hailed AMD CEO Lisa Su as a hero among chip maker executives. On the other hand, AMD and Su haven’t been the center of attention on Wall Street. Is something amiss at AMD?
Not necessarily. As we’ll explain, AMD is still a relentless envelope pusher in the technology hardware field.
It would be hasty to dismiss AMD stock as yesterday’s news, as it could still return to its previous high price from a few months ago.
Which Insider Sold AMD Stock?
Here’s the scoop. Even if Su is the beloved chief executive of AMD, this hasn’t stopped her from divesting thousands of shares of her company.
To be more specific, Su reportedly sold 75,000 AMD stock shares recently. Furthermore, during the past year, Su has sold 450,000 AMD shares and purchased none.
It’s difficult to know exactly why Su sold those AMD shares. She may have taken profits if she bought the shares at a lower price.
Some investors might choose not to take a share position in AMD stock because they’re worried about the insider selling. You don’t have to panic and sell your AMD shares if you don’t want to, though.
After all, the company is still a tech trailblazer in multiple tech niche fields, from artificial intelligence inference and optimization tools to AI-enhanced automotive camera systems.
AMD Picks Up a $150 Price Target
AMD is making waves with fresh products for digital signal processing applications, as well as for data center and cloud storage use cases. Clearly, AMD hasn’t relinquished its leadership position in the global tech component market.
Recognizing AMD’s tech trailblazer status, Wells Fargo analyst Aaron Rakers recently assigned an “overweight” rating to AMD stock. He also published an ambitious $150 price target for AMD shares.
Rakers reportedly met with Su and AMD Chief Financial Officer Jean Hu and came away “incrementally more positive” that the company’s MI300 chip ramp-up should (per Seeking Alpha) help AMD’s push in the data center market.
Rakers relayed AMD’s estimate that the “Data Center AI accelerator [total addressable market] will grow to $150 billion over the next 3-4 yrs.”
The analyst also clarified that “AI inference” is “to account for two-thirds of this opportunity w/ inflection by 2025.” The implication, presumably, is that AMD will be well-positioned to capture a sizable chunk of this fast-growing tech-industry niche.
No Need to Lose Faith in AMD Stock
Obsessing over Su’s AMD share sales might prompt some investors to make decisions they’ll regret later on. No matter how you slice it, AMD remains a trailblazer with powerful, AI-compatible tech products.
Will the AMD share price reach Rakers’ $150 price target? That’s an ambitious objective, and investors should need to be realistic. AMD stock has the potential to revisit its $130 peak from the summer of 2023.
So, there’s no need to give up on AMD just because the chief executive sold some of her shares. AMD, with its relentless quest to innovate, still has room to grow in today’s competitive hardware market.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
