Advanced Micro Devices (AMD) stock is experiencing a decline of over 3% on Monday, trading at $150 per share. This downturn is likely attributed to the broader weakness in the tech sector and investor anticipation surrounding Nvidia Corp’s upcoming second-quarter earnings report, set to be released after Wednesday’s market close.
Nvidia’s earnings report is highly anticipated, with analysts forecasting a strong performance. Expectations are for earnings of 64 cents per share on revenue of $28.68 billion, significantly higher than the previous year. Nvidia’s stock, which has seen a remarkable 160% year-to-date surge, could experience further gains if results surpass expectations and positive outlooks for AI accelerators are provided.
Why This Matters for AMD:
Nvidia is a direct competitor to AMD in several markets, particularly in GPUs (Graphics Processing Units) and AI accelerators. If Nvidia reports exceptionally strong earnings and provides positive guidance, it could indicate that Nvidia is gaining market share in these crucial areas. This could raise concerns that AMD might struggle to compete, potentially leading investors to sell AMD stock.
Nvidia’s results could set the tone for the entire semiconductor sector. If Nvidia significantly outperforms expectations, it might raise the bar for other companies like AMD. Investors might become concerned that AMD might not meet these heightened expectations.
Nvidia is widely regarded as a leader in AI hardware, particularly with its GPUs being essential for AI workloads. If Nvidia demonstrates strong growth and dominance in this area, it could overshadow AMD’s efforts in AI, further pressuring AMD’s stock.
Investing in AMD and Nvidia:
Investors can gain exposure to both AMD and Nvidia by investing in exchange-traded funds (ETFs) like the Invesco QQQ Trust, Series 1 (QQQ) and the SPDR S&P 500 ETF Trust (SPY).
How to Buy AMD Stock:
Besides purchasing shares or fractional shares through a brokerage platform, you can also access AMD shares by investing in an ETF that holds AMD stock or by allocating your 401(k) to a strategy that aims to acquire shares in a mutual fund or other investment instrument. For example, AMD is categorized within the Information Technology sector. An ETF that tracks this sector will likely hold shares in several large and liquid companies, allowing investors to gain exposure to trends within the segment.
According to data from Benzinga Pro, AMD has a 52-week high of [High Value] and a 52-week low of [Low Value].
