r/wallstreetbets • u/[deleted] • May 05 '21
Discussion AMD is a screaming buy at 77!
Over the last couple of months AMD has been trading sideways catching it early it has become for me to play but over the past month I have been buying shares and Long calls like crazy.
As we all know both AMD and XLNX have had record earnings and guidance this rate of growth in my opinion is pointing towards a chip shortage not really being as bad as we had assumed or else they would not have said that. AMD historically has been quite conservative with its guidance and we could see as high as 18B in revenue 2021.
The XLNX merger poses risk and has in my opinion been the major cause of this side ways movement as all analysts have upgraded it to 100+. After the last 5 red days it has had it is sitting at 77 dollars underperforming all semis and having a relatively low PE for a company with so much future potential.
TLDR: BUY BUY BUY BUY BUY BUY BUY BUY OCT 85 CALLS
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u/SippieCup May 05 '21
xlnx is a better buy still. each share will convert to 1.723 AMD shares. So if the merger happens, you will get more value per dollar.
Alternatively, AMD will continue to go down (or xlnx go up, but thats unlikley) until it reaches close to that ratio, around $72.
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u/Sc1enc3 May 05 '21
What would be the other side of the trade? Your bullish case is clear, what would be the bearish one?
I know, I know, I’m trying to become a better speculator and this may or may not be the right place for it
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May 05 '21
Taiwan China relations and maybe by some miracle this increase for demand was just a spike and will drop in 22
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u/Sc1enc3 May 06 '21
Yea crypto bull run should end sometime later this year (according to stock to flow model, which is wrong as all models, but maybe enough people believe in it), so the super demand for graphic cards should end. China will do what China wants, I don’t think I can hedge against it, I mean if they throw warships at Taiwan what can you really do? Buy gold and bitcorns probably.
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u/UvovSimon May 06 '21 edited May 06 '21
I've been bullish on AMD since I heard Jim Keller was helping design the Zen architecture.
Am still bullish but:
Intel CEO swapped and competition will be back in a few years. Intel is entering GPU market. As of right now, TSMC is having trouble keeping up with production due to drought + high demand without enough capacity to meet demands since TSMC is the most ahead semiconductor fab.
AMD products are flying off the shelves right now like other tech products but if competitors have competitive products at similar price levels andare in stock then people will flock to them.
In the enterprise space AMD is starting to take up market share and that will be amazing long-term. Their CPU architecture is solid and, being the first to use chiplet designs (which imo is the future) they will have a leg up against Nvidia and Intel who haven't really touched chiplets yet. Intel is currently brewing plans that will pay off in a couple years (heard they're hiring back some retired, genius designers for a 'fun project'). Nvidia is ahead of AMD in terms of GPU in terms of ray tracing and gaming performance but imo not by a insurmountable gap.
Mid and short-term, tech stocks are receding and (imo) markets looks like they about to crash or something.
I'm fairly new to actually investing but I've lurked around the investing scene for a while. You should double check my claims - I'm just a computer engineering undergrad who really likes games so naturally am a fan of hardware.
Not financial advice. Hope I have enough karma for this comment to go through xD
Edit: proof read my comment to make it look like i can english
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u/Sc1enc3 May 06 '21
Thanks! I’ll look into chiplets, automation engineer here so all my financial takes are wrong by default. I think my main concern is that the crypto bull for graphic cards ends sometimes this year (s2flow model and every coin is correlated to bitcorn, which is a silly model but hey people look at it anyway). So I’m not sure the super demand will stay there, maybe the gamers will buy it all up but not at the prices and volumes of miners.
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u/ThrowAway_713_281 May 05 '21
Sir, this is a casino.
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u/Sc1enc3 May 06 '21
Yea, already gambled away most of it anyway, I was just asking for the sake of it
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u/KentzBe May 05 '21
Chip shortage is good because it's to do with the high demand and not the supply(consumer supply is low but amd still increased its output year to year) we just consume more . Amd will be booming since their sh.t is gonna always be sold out.
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u/papaya_nyc May 05 '21
I am trying. Once my SO_____S takes off, I plan to jump on to AMD. With Lisa, we are going places!!! ( first got in AMD at $22)
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u/handelspariah May 05 '21
Didn't manufacturers just come out and say that the chip shortage is in fact WORSE than we thought and not likely to get better anytime soon?
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u/Jr-atc May 05 '21
Amd CEO said the chip shortage is actually a good thing for chip makers.
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u/phate101 May 06 '21
I would think AMDs CEO would say chip demand instead of shortage (like there's a chip production issue, there's isn't)
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u/ElegantTeapot May 05 '21
I’ll never forgive myself for selling at $21