Trading Strategies For Advanced Micro Devices Before And After Q2 Earnings

Zinger Key Points
  • Analysts, on average, estimate AMD will report earnings per share of 57 cents on revenues of $5.323 billion. 
  • AMD was breaking up from a long-term descending triangle on high volume Tuesday.

Advanced Micro Devices, Inc AMD was popping almost 3% Tuesday higher ahead of its second-quarter earnings print set to take place after the market closes

When AMD printed first-quarter results on May 2, the stock plunged almost 20% the following day before reversing into a steep uptrend.  

For that quarter, AMD reported first-quarter non-GAAP earnings per share of $1.13, beating the 91-cent consensus estimate. The semiconductor stock printed record revenues of $5.89 billion, which exceeded the consensus estimate of $5.52 billion 

For the second quarter, analysts, on average, estimate AMD will report earnings per share of 57 cents per share on revenues of $5.323 billion. 

On July 27, Rosenblatt analyst Hans Mosesmann reiterated a Buy rating on AMD and maintained a price target of $200. Read More… 

From a technical analysis perspective, AMD's stock looks bullish heading into the event, broken up from a triangle pattern. 

It should be noted that holding stocks or options over an earnings print is akin to gambling because stocks can react bullishly to an earnings miss and bearishly to an earnings beat. 

Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial

The AMD Chart: AMD started to trade in a symmetrical triangle on June 13 after beginning to rise above an ascending trendline on May 4. The stock was set to meet the apex of the pattern on Aug. 3, but on Tuesday, AMD was breaking up from the formation on high volume. 

  • The semiconductor giant was also breaking up from a double inside bar pattern on Tuesday and working to print a bullish Marubozu candlestick on the daily chart. If the stock closes Tuesday's session near its high-of-day, it becomes increasingly likely AMD will trade higher again on Wednesday. 
  • If AMD suffers a bearish reaction to its earnings print, the stock may fall back under the upper descending trend line of the triangle, which could continue to pressure AMD to the downside. 
  • AMD has resistance above at $118.13 and at $122.49 and support below at $112.61 and at $106.99. 

Read More: Bullish On The Semiconductor Sector Ahead Of Advanced Micro Devices Earnings? This ETF Offers 3X Leverage

Photo courtesy of AMD.

Market News and Data brought to you by Benzinga APIs
Posted In: Long IdeasShort IdeasTechnicalsTop StoriesTechTrading IdeasExpert Ideas
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!