You down with AMD?
Canaccord Genuity Technology Analyst Bobby Burleson increased his target on AMD following his attendance at the company’s analyst day. While nothing at the event appeared to be groundbreaking, he left with greater conviction regarding the company’s ability to execute, both for manufacturing (fewer foundry missteps going forward) and design (zealously focusing on growth opportunities).
In his view, better execution is likely to deliver on previous expectations of share gains in mainstream notebook and server. He also sees more consistent free cash flow generation going forward, allowing for further improvements to the balance sheet.
A few highlights from the meetings: 1) Management described recently improved yields as systematic, fundamental improvements that are sustainable and remain on a “good track” in Q1; 2) The trends toward low power and emerging markets growth favor AMD as AMD tends to be more emerging markets-focused for its existing business, and its move to APUs, integrating GPI and MPU functionality achieves a price/performance balance attractive to these customers; and 3) Cost cutting and a move to a fables model have produced greater and more predictable cash flow.
Advanced Micro Devices (AMD : NYSE : US$7.08), Net Change: 0.15, % Change: 2.16%, Volume: 15,293,490
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