- Early high of $22.40 per share on Wednesday
- Full-year 2019 outlook is positive
- CEO Lisa Su wins confidence
Despite missing revenue targets, Advanced Micro Devices Inc (AMD) stock jumped 16% from Tuesday’s close to hit an early high of $22.40 on Wednesday.
AMD reported its earnings after Tuesday’s close. Although it set expectations below the consensus, shares jumped by 19.95% from a session close of $22.40. Trading on Wednesday saw this extend by another six points.
The slightly unusual response to a disappointing earnings report was down to the semiconductor company pointing to an excess inventory for its graphics chips. This factor alone would have normally led to a dip in stock value, but the risk was already priced in, with AMD shares being 43.8% lower than the high of $34.14 set in 2018. The low of $16.03 seen on December 24 has now risen by close to 40%.
Investor confidence has been buoyed by the full-year 2019 outlook set out by the company. The positive picture painted by comments about the next generation of PC, data center and server semiconductor components has combined with good chart data to produce the latest stock bounce.
The daily chart for AMD shows that the dreaded “death cross” formation that had been hinted at is now far less likely to occur. Shares have been rising higher along the 200-day simple moving average since last October.
AMD’s weekly chart will be positive if it stays above a five-week modified moving average of $20.65 at the end of this week.
CEO Lisa Su has been instrumental in inspiring growing confidence around the company, and her credibility comes on the back of AMD’s overall 2018 performance, which saw the most profit and revenue generated in seven years.