Advanced Micro Devices (AMD) is struggling to gain ground in the computing industry, but its artificial intelligence (AI) segment has been a bright spot. The company reported a mixed Q4, with revenue growth of 69% in its data center division, which competes head-to-head with Nvidia. However, this growth was not enough to offset losses in other segments and caused the stock to fall more than 6%.
Despite this setback, some analysts believe that AMD’s AI stocks are undervalued compared to rival Nvidia. The company is expected to undergo significant earnings growth in 2025, but its valuation is currently higher than Nvidia’s at 113 times trailing earnings versus Nvidia’s 28 times forward earnings.
This raises a question: why invest in the second-place company when there are better opportunities available? For those who feel they’ve missed their chance to invest in top-performing stocks like Apple and Netflix, this could be an opportunity to consider. Our expert team has identified three incredible companies with potential for significant growth, and there may not be another chance like this anytime soon.
However, investors should be cautious and thoroughly research each company before making a decision. AMD’s management has guided for $7.5 billion in sales for the fourth quarter, but the stock is now at its lowest price since late 2023. A deep discount may provide a value investment opportunity, but it’s essential to consider the risks involved.
Source: https://www.nasdaq.com/articles/will-amd-be-best-artificial-intelligence-ai-stock-2025