Rosenblatt: AMD Will Be 'Much Bigger Player In High-End GPU Gaming'

On Monday, Advanced Micro Devices, Inc. AMD CEO Lisa Su gave the keynote speech at the Computex show in Taiwan, and one analyst says AMD’s upcoming 7nm chip rollout in the second half of 2019 has impressive disruptive potential.

The Analyst

Rosenblatt Securities analyst Hans Mosesmann reiterated his Buy rating and $42 price target for AMD.

The Thesis

Mosesmann said AMD made several product announcements on Monday that highlight the company’s leadership position in the CPU market for years to come. The new series of 7nm Zen2 architecture Ryzen 3000 desktops AMD is launching in the second half of 2019 should immediately begin eating into the Intel Corporation INTC 14 nm CPU market share.

“At a high level, AMD 7nm-based Ryzen 3000 desktop CPUs will meet/beat Intel in single threaded workloads, easily exceed in multi-threaded (25%-35%), and at 30%-35% lower power,” Mosesmann wrote in a note.

Even better for AMD investors, Mosesmann said AMD will likely have superior CPU tech to Intel through at least 2021.

AMD also disclosed its new Nave GPU will support PCle 4.0, which Mosesmann said could make it a much bigger player in the high-end GPU gaming market. Intel and NVIDIA Corporation NVDA may not support PCle 4.0 until 2020, Mosesmann said.

Investors will be watching the E3 show next month closely for pricing of the AMD 7nm Navi RX 500 after the chip outperformed the $490 Nvidia RTX2070 by about 10 percent.

Even with AMD stock up more than 112 percent in the past year, Mosesmann said the full value of AMD’s upcoming family of chips is not yet appreciated by the market.