AMD Tumbles to 9th in WSB Rankings Amid Sector Selloff and Downgrade

Advanced Micro Devices (AMD) has declined to the 9th position in the latest WSB ranking, dropping three spots since yesterday.
AMD saw a significant decline of 5.18% in the past two trading days, influenced by a broader selloff in the semiconductor sector. This comes on the back of Nvidia's poor performance, which saw a stock price drop of 1.66% on September 4th, following a steep decline of 9.53% the previous day. The downturn in Nvidia has dragged down other semiconductor stocks, including Intel with an 11.8% drop, Micron Technology at 7.22%, ASML Holding at 10.22%, and Taiwan Semiconductor Manufacturing Company (TSMC) with a 6.31% decrease.
Despite the overall negative sentiment in the semiconductor sector, which has also affected companies in Japan and South Korea, the A-share market has shown relative resilience. Yet, it has not been immune to the overall trend of declining semiconductor stock prices this year.
Notably, Barclays downgraded AMD's rating from "Overweight" to "Equal Weight" on September 4, reducing the price target from $693.00 to $438.00. This downgrade adds to the pressure on AMD, highlighting the intense scrutiny and volatile nature of the semiconductor sector.
Earlier in August, AMD reported its 2024 annual earnings, showing impressive growth with a 109.77% increase in revenue year-over-year to $14.943 billion. The company also posted a net profit of $1.208 billion, translating to a basic EPS of $21.73. AMD, originally registered in California in 1993 and re-incorporated in Delaware in 2007, continues to provide a range of high-performance and high-efficiency computing platforms for various markets, including enterprise data centers, cloud computing, and artificial intelligence.
Additionally, recent reports suggest that AMD's stock was among those targeted by short sellers, casting further doubt on its valuation and stability. Mahoney Asset Management's CEO, Ken Mahoney, highlighted the unstable performance of stocks like AMD in comparison to more consistent giants like Nvidia.
Overall, while AMD's fundamentals show robust growth, the downgrades and sector-wide challenges underscore the complexities and risks inherent in the semiconductor industry. With ongoing volatility and market adjustments, investors remain cautious about the future prospects of AMD and its position within a highly competitive and rapidly evolving sector.