Key Takeaways From Barclays' AMD Downgrade

  • Barclays analyst Blayne Curtis downgraded Advanced Micro Devices Inc AMD to Equal Weight from Overweight with a price target of $115, down from $148 (3.54% downside).
  • The company's growth story needs a pause with cyclical risks looming in 2023, admitted Curtis.
  • AMD remains positioned to gain market share in both the client and server markets this year, but cyclical risk across several end markets will come in 2023. 
  • He believes all three segments are running at elevated levels, which pauses the risk to AMD's growth trajectory.
  • AMD's Q4 results exceeded expectations on every metric, with solid data center revenues and server and gaming processor sales.
  • AMD issued upbeat forecasts for the March quarter and FY22 amid the ramp of existing products and the launch of next-gen products planned for the year.
  • Investors continue to watch U.S. economic data, Russia-Ukraine developments, and the Fed rate hike outlook. 
  • A worse-than-expected U.S. GDP data and a rebound in oil prices have also weighed on market sentiment.
  • Price Action: AMD shares traded lower by 1.97% at $116.67 in the premarket on the last check Thursday.

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