AMD stocks are an opportunity not to be missed

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<p class = "Screen-Atom Screen-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "The coronavirus epidemic has destroyed stocks worldwide. Even multinational ones Semiconductor companies modern micro devices (NASDAQ:AMD) is no exception as AMD stock fell 14% last month due to supply chain disruptions due to the pandemic. “data-reactid =” 12 “> The coronavirus epidemic has hit inventories worldwide, even multinational semiconductor companies modern micro devices (NASDAQ:AMD) is no exception as AMD stock fell 14% last month due to pandemic supply chain disruptions.

AMD stocks are an opportunity not to be missed

AMD stocks are an opportunity not to be missed

Source: Diverse Photography / Shutterstock.com

Despite the potential drop in sales, AMD’s diversified sales mix puts it in an excellent position to weather the storm and stay on track for strong performance this year.

Let’s take a closer look at the reasons why AMD stocks emerge from the chaos of corona viruses as winners and why they are a must for your portfolio.

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The growth of work from the domestic economy

It’s no secret that the coronavirus crisis has caused several organizations to take on homegrown work. CNBC’s Jim Kramer spoke of the situation, saying that the current Covid 19 crisis revealed nothing about our collective transition to a teleworking culture, but rather that the “outbreak is spilling fuel on the fire at home.”

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "With more employees who work from home The demand for laptops, network peripherals and communication services is increasing dramatically Zoom video communication (NASDAQ:ZM), a cloud-based video conferencing tool, has seen a massive increase in demand for its services. “data-reactid =” 32 “> As more and more employees work from home, the demand for laptops, network peripherals and communication services increases dramatically for companies like Zoom video communication (NASDAQ:ZM), a cloud-based video conferencing tool, has seen a massive increase in demand for its services.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Social media platforms such as Twitter (NYSE:TWTR) and Facebook (NASDAQ:FB) have also seen an increase in engagement. All of these developments point to increasing demand in the network and data center area. “Data-reactid =” 33 “> Social media platforms such as Twitter (NYSE:TWTR) and Facebook (NASDAQ:FB) have also seen an increase in engagement. All of these developments point to increasing demand in the network and data center area.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Speaking of Intel (NASDAQ:INTC) dominated the sector with a market share of over 95%. However, data center growth declined 19% year over year. “Data-reactid =” 34 “> Speaking of Intel (NASDAQ:INTC) dominated the sector with a market share of over 95%. However, data center growth declined 19% year over year.

A strong performance in the fourth quarter enabled Intel to grow the data center segment by 2%. AMD, on the other hand, is steadily gaining Intel’s market share in this sector with the success of its Epyc processors and Radeon Instinct GPU accelerators.

The data center segment accounted for 15% of its $ 6.73 billion in revenue last year. Given the increasing volume of AMD, the sector expects double-digit growth.

Intel completely wiped out its competition after the 2009 financial crisis. Given AMD’s recent advances, however, the results will vary widely if the coronavirus leads to a prolonged recession. CFO Devinder Kumar states that the company plans to generate 30% of its sales in 2023 with data center products, which is 15% compared to 2019.

Strong financial performance

AMD’s financial data has been in a rift in the past three years, and sales and gross margins have increased significantly. In the words of managing director Lisa Su: “2019 was a significant milestone on our multi-year journey when we successfully launched and expanded the strongest product portfolio in our 50-year history.”

Revenue rose 50% last year, primarily due to the computing and graphics segment. The gross margin increased 7%, primarily due to the 7 nm increase in products.

Operating profit and net income also rose steadily in the past year. Perhaps the most encouraging sign for the company is the $ 524 million in debt reduction and a massive 300% increase in free cash flow.

The CEO predicts that the company will achieve sales growth of 20% and a gross margin of more than 50% in the next four years. She indicated that AMD had maintained its $ 1.8 billion sales guidance for the first quarter.

Although weaker demand in China will impact sales, sales in other sectors are estimated, which would result in a 28% to 30% increase in sales in 2020.

PC games: a world of possibilities

The PC gaming market is growing tremendously with the growth of esports and popular multiplayer titles. Most esport tournaments are played on PCs, which increases the demand for high-end processors and graphics cards.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Nvidia (NASDAQ:NVDA) is the market leader in the discrete GPU area with a market share of 69%. However, with an affordable price model for the GPUs RX 5700 and RX 5700 XT, AMD was able to gain significant ground last year. AMD also poses a significant threat to Intel’s fluctuating position in the video game laptop market. “Data-reactid =” 51 “>Nvidia (NASDAQ:NVDA) is the market leader in the discrete GPU area with a market share of 69%. However, with an affordable price model for the GPUs RX 5700 and RX 5700 XT, AMD was able to gain significant ground last year. AMD is also a significant threat to Intel’s fluctuating position in the video game laptop market.

The new 3rd generation Ryzen 4000 processors for laptops were presented at the CES 2020 conference. These two are the most powerful mobile laptop CPUs in the series and were developed with mobility in mind. The processor is likely to affect sales of the top-of-the-range Intel i9 9880H and pose a serious threat to its dominance in the coming years.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Let's not forget either Sony (NYSE:SNE) and Microsoft (NASDAQ:MSFT) will launch their next generation consoles this year and AMD will supply chips for the systems. “data-reactid =” 53 “> Let’s not forget either Sony (NYSE:SNE) and Microsoft (NASDAQ:MSFT) will launch their next-generation consoles this year, and AMD will supply chips for the systems.

Conclusion on AMD

If you’re thinking about investing in the best recession-proof stocks, AMD stock must be on your list. The change in work culture offers AMD a unique opportunity to outperform its competitors in the first and second quarters of 2020.

With its innovative GPU and its processors, the company is ready to gain a foothold against Nvidia and Intel. Therefore, AMD is a strong buy in my book and you should buy it at a discount now.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "At the time of this writing, Muslim Farooque had no position in any of the above securities. “data-reactid =” 57 “>At the time of this writing, Muslim Farooque had no position in any of the above securities.

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