Posted 2/3/2024, 12:40:00 PM
AMD Soars on AI Hype But Competition Looms as Microsoft, Intel Advance AI Plans
- AMD stock has soared over 130% in the past year due to AI hype, but its valuation looks stretched with a forward P/E of 45.
- Meanwhile, free cash flow has dropped 47% amid heavy investment, making AMD riskier than better-valued AI stocks.
- Microsoft is leveraging OpenAI models across products and monetizing AI through new subscriptions. Its stock is up 64% with more room to run.
- Intel missed earnings forecasts due to the AI/GPU boom hurting CPU demand, but it's investing heavily in AI and trades at a reasonable forward P/E of 32.
- Intel's restructuring efforts make it an exciting long-term AI play and a better value than AMD right now.