According to Citi Research, AMD shares are going to fall.
The firm, which just reiterated a “sell” rating on the company’s stock, believes that AMD will not be able to compete with its main rival Intel’s latest chips. Intel just released its eight-generation processor line earlier this month on the 5th.
Citi analyst Christopher Danely wrote on Monday, “This month, Intel released its latest CPUs, which appear to have extended its performance lead … We see the competitive environment for AMD CPUs getting more difficult over time as the competition continues to introduce new processors.”
“Despite new products, AMD is still losing money we see no change in sight as it falls further behind the competition.”
Danely has a $5 price target on AMD which would be a drop of over 60% compared to AMD’s closing price this past Friday.
Despite the note from Citi, AMD is still up over 100% YTD.
According to Danely, “We do not expect share gains to be sustainable,” he wrote. “We believe AMD’s next process
should not be sufficient to close the current performance gap and Intel’s next process should increase the performance gap.”
Disclaimer: We have no position in Advanced Micro Devices, Inc. (NASDAQ: AMD) and have not been compensated for this article.