I ranted and raved about how the analysts are pumping up AMD's share price even as it loses money. I had called a trading range of 11.50 - 13.00 in the commentary of one of my posts (can't be bothered to look for it now).
AMD is now trading around $ 12.50. I expect this to go still further South close to 12. Will it drop to 10...it should. But at that point it probably starts looking attractive to the private equity guys and there are probably enough interested parties that want to keep AMD afloat so my expectation is it will stay above 11.
It appears Penryn is more than a die shrink.
AMD is in deep trouble as Barcelona still seems to be in some trouble being manufactured and they have not yet allowed the tech sites to publish any independant benchmarks.
However, Intel is also not out of the woods. To accelerate their stock price, they need to grow revenues faster than the market. And their best bets to do this are Silverthorne and monetizing Wimax at the service level and not just the hardware level.
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7 comments:
What is the current AMD's Book value?
Because if I'm not mistaken, it was trading for 40 a year and a half ago, it must have been very inflated...
AMD starting dropping like a stone as soon as the sub-prime problem spilled over into private equity borrowing. Proves the point that it had been supported by hopes for a PE bid not some Wall Street conspiracy.
I don't think this proves the point that the stock was being kept at the levels it was due to the PE buyout bid rumor.
First - that rumor died some time ago. Second, have you considered the possibility that the Wall St bunnies may have realized that with the impending sub-prime disaster, they would be unable to sustain an unrealistic price level and are now cutting their losses.
No use trying to convince someone of the obvious when they want to believe in conspiracies.
Clearly the POSSIBILITY of a buyout added some value to the AMD stock - every other value metric (P/E, Price/book, EBITDA, forward P/E, PEG) are all N/A (due to losses) or terrible.
It's hard to say how much, but as AMD was falling faster than the market recently (with exception of today) and with no major news, I think it's fair to speculate that the decreased probability of a buyout (or the likely lower value of a buyout offer due to less favorable credit terms) due to the credit "adjustments" in the market had to have had some effect.
Another 1.7 Bil in convertible notes - wonder what that will do to the stock?
http://www.tgdaily.com/content/view/33291/118/
Generally convertible notes are offered when a company is in a strong and prosperous position, right? (i.e we have no freakin prayer of paying off the MS loan with actual real cash flow...)
Anonymous - I'll be convinced when I'm presented with an incontrevertible argument. Just as I'm sure you're not convinced with my theory.
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