UPDATE: Macquarie Downgrades Advanced Micro Devices to Neutral on Valuation
Early Thursday morning, Macquarie analyst Shawn Webster downgraded Advanced Micro Devices (NYSE: AMD) from Outperform to Neutral and maintained the $3.30 price target.
The report stated, "AMD has confirmed it will supply chips for the Playstation 4 and X-Box 720. While we believe it will be margin percent dilutive, we still estimate it will have significant earnings power, which appears to be unappreciated by the Street. If we subtract our game console chip forecast from Consensus AMD revenue forecasts, it implies the Street is expecting AMD's core business to be flat in Q3 and decline 5% QoQ in Q4—which we think is too bearish. We model sequential growth of up 16% QoQ for each of Q3 and Q4 at AMD versus the Consensus forecast of up 6-8% QoQ."
Following the rating change, shares have fallen 0.93 percent to $3.22.
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