Investors who have owned stocks in the last year have generally experienced some big gains. In fact, the SPDR S&P 500 SPY total return over the last 12 months is 55.9%. But there is no question some big-name stocks performed better than others along the way.
AMD’s Run: One company that has been a solid investment in the last year has been semiconductor stock Advanced Micro Devices, Inc. AMD.
In the past couple of years, AMD has gained and leveraged a technology advantage over competitor Intel Corporation INTC in the CPU market, where analysts say it may take Intel at least two years to bring its 7 nm chips to market. AMD is also gaining market share from Intel in the massive server chip market as well.
Fortunately for AMD investors, the COVID-19 pandemic in 2020 was actually very good for AMD’s business. While other companies were dealing with economic shutdowns, people around the world were sheltering in place, creating a boom in remote work and online gaming.
In fact, in 2019 AMD reported 30 cents in EPS on $6.73 billion in revenue. In 2020, those numbers jumped to $2.06 in EPS on $9.76 billion in revenue.
At the beginning of 2020, AMD shares were trading at around $47. By the beginning of March, the stock was still hovering around $47.50, even after news of the coronavirus spreading in China prompted concerns about a U.S. pandemic.
AMD bottomed at $36.75 during the pandemic-driven March sell-off. Fortunately for AMD investors, the dip did not last long.
By July, AMD shares were back at new all-time highs above $60 and the stock got as high as $94.28 in September prior to an extended consolidation period. AMD has traded mostly sideways between around $75 and $95 ever since.
Traders may be taking profits in the stock, which has been one of the top market performers of the past decade. Or they may simply see 2020 pandemic comps setting AMD up for some lackluster growth numbers in coming quarters.
AMD In 2021, Beyond: AMD eventually made it back up to new all-time highs in January 2021 when it jumped to $99.23 on optimism surrounding fourth-quarter earnings. Investors sold the strength, and the stock quickly dropped back down into its previous trading range. In recent days, the stock was trading around $77.
Still, AMD investors who bought one year ago and held on have generated a decent return on their investment. In fact, $1,000 in AMD stock bought on May 10, 2020, would be worth about $1,437 today.
Looking ahead, analysts are expecting more upside for AMD in the next 12 months. The average price target among the 31 analysts covering the stock is $110, suggesting 43.9% upside from current levels.
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