BMO Capital Markets said Advanced Micro Devices, Inc. AMD is executing well under the new CEO after the third-quarter revenue beat estimates and the fourth-quarter estimate is also above on an absolute basis.
Advanced Micro Devices' revenues of $1.31 billion for were well above BMO estimate of $1.21 billion. Pro forma earnings were $0.03 per share versus BMO/consensus’ breakeven.
The company expects fourth-quarter revenues to be down 18 percent sequentially at the midpoint, to $1.07 billion, above BMO expectation of $1.01 billion and consensus of $1.06 billion. For 2016, guidance implies revenues to be up 6 percent year-over-year versus BMO forecast of up 2 percent year-over-year.
Analyst Ambrish Srivastava raised his 2016 and 2017 EPS estimates on higher revenues, lower interest expense from deleveraging, partly offset by higher share count and higher opex.
“Our 2016/2017 EPS estimates go from $(0.21)/$(0.06) to $(0.15)/$0.09. Our target price goes higher to $6 from $5 on a similar EV/Sales multiple on higher sales,” Srivastava wrote in a note.
Advanced Micro Devices closed Friday's trading down 6.32 percent at $6.52.
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