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Politics : Formerly About Advanced Micro Devices

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To: combjelly who wrote (254967)10/12/2005 3:21:04 PM
From: tejek  Read Replies (2) of 1576308
 
If I were an AMD shareholder, I would be pissed today"

AMD blew past expectations. The Street always punishes AMD for that. Now if they had missed by a penny or two, then $30 would be in the rear view...

Why it trades this was, I dunno. On the surface at least, it seems counter-intuitive.


Well, I may have figured out why its down today. When I posted earlier, I was under the belief that AMD had been making money for most of the past 4 quarters. That was a bad assumption on my part. In fact, AMD has made $.11 the past year. At a stock price of $25, AMD had a PE of 227. That compares very unfavorably with the Sector PE of 26.

Even if AMD were to make $.18 EPS for the next 3 quarters, that would only give it an EPS of $.72. At $25, that would give AMD a PE that's much bigger than the Sector's...........34 vs 26........and with AMD, its never clear if they will continue to make money quarter after quarter like INTC. Clearly, AMD's stock price got way ahead of itself.......hence the pullback today.

ted
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