AMD - Advanced Micro Devices Inc.

[AMD] Advanced Micro Device Stock - Hot stock to buy entry price: $2.85 - $3.35

• Risk level: 6
• Profit potential: 7
• Price Target: $5.5 - $6
• We expect AMD to outperform the market in the longterm.  Expect a little price drop after earnings date due to negative earnings report.  Will represent a good buying opportunity.

We are selecting AMD as our next Hot Stocks to Buy.  On April 21st, AMD reported deeper than expected 1Q loss of $416 million.  After their report and disappointing guidance AMD sold off in afterhours and loss approximately 5% in share price.  The .66 cents loss was not as wide as expected and some of the loss can be attributed to one-time charges due to the company’s biggest restructuring in it’s 40 year history.  Without the one time charges, AMD would have had a loss of 62 cents per share.  Their sales for the year dropped 21 percent to $1.18 billion, which was above the estimates of $978 million.  Reasons why we are adding AMD to our hot stocks to buy portfolio:

• As bad as their earnings report seem, it’s actual beat the esitmates of most analyst and in our view should be seen as a positive instead of a negative.
• The afterhour drop of 5% was mainly due to feelings that they may lose market share to Intel.  This was something that CEO Dirk Meyer quickly knocked down and we agree.  We do not expect AMD to lose much market share to Intel in future quarters as more computer buyers look for lower cost systems which AMD can help supply with their less expensive CPUs in comparison to Intel’s.
• The drop in afterhour and possible drop on Wednesday morning will be a golden opportunity for buyers to purchase the stock at a discount.
• Newer computers will be required as Windows 7 is released during the 4th quarter of 2009

We plan to add AMD to our hot stocks to buy portfolio at a price range between $2.85 - $3.35.  over the next few quarters, we expect to see a price of $5.5 - $6 per share.

As always, please perform your own due diligence and make your decisions based on that due diligence.  Our stock portfolio is for entertainment purposes and do not represent a recommendation on the actual stock.