Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: f.simons who wrote (120782)	7/24/2000 10:59:37 AM
From: TimF	Respond to of 1572965

That is exactly the point. One of the reasons for AMD's meteoric stock rise in the last year has been accelerating revenues. You didn't get that this time. The price already reflects the great past performance. The trailing P/E is about 40. Assuming AMD only makes $5 this year the trailing would be 16.4 at the current stock price. $5 doesn't require a lot of growth because in the first 2 quarters there has already been $2.36 of earnings. The price has increased because of the earnings increase but the forward multiple even with some very conservative estimates on the earnings side doesn't seem to have already discounted strong growth. Tim

To: f.simons who wrote (120782)	7/24/2000 11:24:29 AM
From: tejek	Respond to of 1572965

Frank That is exactly the point. One of the reasons for AMD's meteoric stock rise in the last year has been accelerating revenues. You didn't get that this time. The price already reflects the great past performance. You seem to be stuck on this issue with which I would agree if I thought it were true.....but I don't. In years past both Intel and AMD have had a typical pattern when it came to quarterly sales....Q4 was the biggest, followed by a drop in Q1, then again in Q2 and then followed by increasing sales in Q3. However this year the historical pattern was changed when AMD grew sales from Q4 to Q1 (note: like in times past, Intel's revenues dropped from Q4 to Q1; however it too broke with historical patterns and increased revs from Q1 to Q2). This break with tradition has caused considerable discussion among analysts as to whether the historical patterns truly have been broken. I think time will tell. Now an argument can be made that the increase in AMD's revs from Q4 to Q1 was greater than the increase from Q1 to Q2, and therefore that rev growth is decelerating. However in light of the changes occurring to past growth patterns, I think it would be premature to make such an argument. BTW Intel's surprising 23% YOY increase in rev sales is due to that break in traditional patterns; this year, Q2 revs increased where they dipped last year. Actually, several analysts voiced concern about revenues, but admittedly did not emphasize them. In an otherewise good report, they may have been afraid of being accused of nitpicking, which may be what I am doing. But I don't think so. Like I have said before, many analysts have upgraded AMD's estimates and/or price targets since earnings. Any who have complained about rev growth (and I have not seen their comments) are truly nitpicking and more, looking for trouble. Not enough time has elapsed, in my opinion, to determine any trends. ted