$AMD Due Diligence — Advanced Micro Devices Inc
Hold · 6/10 — full report on Stockato.
- Price: $521.20
- P/E: 125.06
- Market cap: $959.9B
- Revenue (TTM): $45.4B
- Profit margin: 17%
VERDICT: HOLD
SCORE: 6/10
CONFIDENCE: MEDIUM — options and price action conflict with raised guidance and management execution
COMPANY OVERVIEW
Advanced Micro Devices develops CPUs, GPUs, and AI accelerators for data center, gaming, and client markets. Data Center now drives 64% of revenue; TTM revenue reached $45.4B with market cap $960B.
KEY FUNDAMENTALS
Revenue TTM $45.4B (+44.7% YoY), EBITDA $11.1B, operating margin 17.8%, EPS $4.68. Forward PE 32.9x vs NVDA 11.0x. Analyst consensus: 44 buy/strong-buy, 11 hold, 0 sell; target $657.74 (26% upside from $521.20). Short interest 2.35% of float.
BULL CASE
- Q3 2026 revenue $13.4B beat guidance; company raised 2027 outlook to >80% revenue growth with server CPU and Data Center AI both more than doubling.
- Management credibility 9/10; 7 of last 8 quarters beat or met guidance despite China export headwinds.
- Data Center AI revenue set to surpass server CPU in Q4 2026 on multi-gigawatt deployments at Meta, Microsoft, OpenAI.
BEAR CASE
- Stock fell 10.95% to $521.20 on 49.5M volume after Fermi terminated $6.5B, 222 MW data-center lease with TensorWave.
- Options flow BEARISH: $5.96M bearish premium (68%) vs $2.82M bullish across 30 alerts.
- Forward PE 32.9x still elevated; gaming GPU allocations to Chinese partners reportedly cut 20-50% since October.
OPTIONS POSITIONING
BEARISH_FLOW with 68% bearish premium ($2.82M calls vs $5.96M puts, net -$3.14M). Top trades: $2479k SOLD CALL $550 2027-04-16 SWEEP, $935k BOUGHT PUT $440 2027-06-17, $904k SOLD CALL $575 2026-12-11, $570k BOUGHT CALL $600 2026-11-20, $457k SOLD PUT $310 2027-06-17. IV skew -13.8pp (calls richer). Flow conflicts with raised 2027 guidance and points to near-term hedging or downside bets.
INSIDER ACTIVITY
Zero informative buys or sells in 90 days. 85 routine 10b5-1/diversification sales totaling $116M — explicitly neutral per data.
X / SOCIAL CHATTER
Fermi’s Nov 12 filing confirms termination of $6.5B AMD-backed data-center lease: “Fermi Terminates $6.5 billion $AMD data center… 222 MW… 15-year commitment.” — @rdd147.
AMD raised 2027 company-wide revenue guidance above 80% on Venice CPU and Helios MI400 ramps: “Server CPU revenue now expected to more than double… Data Center AI also significantly more than doubling.” — @Beth_Kindig.
Gaming GPU supply to Chinese board partners cut 20-50% since October with shortages into 2027 per channel checks — @Pirat_Nation.
MANAGEMENT CREDIBILITY
9/10. Consistent beats on guidance for seven straight quarters; transparent on China risks while raising long-term targets and executing ZT Systems integration.
KEY CATALYSTS
Q4 2026 earnings (late Jan 2027); Venice CPU and MI400 ramp visibility; any resolution on China export rules.
KEY RISKS
$6.5B lease cancellation precedent; gaming supply tightening; valuation compression if AI growth misses elevated expectations.
BOTTOM LINE
The 11% drop reflects real cancellation news and bearish options flow, yet AMD just raised 2027 growth targets materially with proven execution. Hold for volatility resolution; dip buyers need confirmation that Data Center momentum remains intact.
How AMD trades
18% below its 52-week high; worst drawdown in the past year 38%.
Moved 7.6% on average (absolute) across the last 8 earnings reports.
Ahead of SPY by 6.4 pts over 3 months, ahead of its peers by 25.4 pts.
Trades as a high-beta name: β 2.7 to QQQ, 0.82 correlation with the peer basket, 5.3× SPY's volatility.
Realized volatility is 120% over 20 days, running hotter than its 1-year 73%.
One-year beta: 3.44 to SPY, 2.66 to QQQ (data-vendor beta 3.43).
Correlation of daily returns: SPY 0.75 (60 days) / 0.64 (1 year); QQQ 0.87 (60 days) / 0.78 (1 year); IWM 0.59 (60 days) / 0.56 (1 year); SMH 0.89 (60 days) / 0.83 (1 year); peer basket 0.91 (60 days) / 0.82 (1 year); 10y yield (daily change) 0.26 (60 days) / -0.07 (1 year).
Realized volatility: 120% (20 days), 81% (60 days), 73% (1 year).
Maximum drawdown over the past year -38%; -18% from the 52-week high.
AMD options and volatility
25-delta puts trade 8.1 vol points below calls in the nearest monthly expiry.
ATM implied vol runs 110% at 2 days to 63% at 153 days (inverted).
Options price 0.62× the last 20 days' realized volatility — cheap.
The first expiry after earnings (2027-02-19, 97 days out) prices ±25.6%, which also covers 97 days of ordinary movement; the average move on earnings day itself has been 7.6%.
Dealers are short gamma; call wall 535.0, put wall 530.0.
Options-implied expected moves: this week (2026-11-16): ±$23.53 (±4.41%); next monthly (2026-11-20): ±$47.91 (±8.97%); earnings expiry (2027-02-19): ±$136.55 (±25.57%).
Options data as of 2026-11-14 05:52 UTC.
AMD vs peers
Comparable companies: NVDA (NVIDIA Corporation), INTC (Intel Corporation), AVGO (Broadcom Inc), QCOM (Qualcomm Incorporated), MRVL (Marvell Technology Group Ltd), MU (Micron Technology Inc), ALAB (Astera Labs, Inc.).
The premium is partially justified: the trailing GAAP P/E gap (-73%) overstates it because Xilinx amortization depresses AMD's GAAP earnings, but a 32.9x forward P/E against an 18.4x peer median, with bottom-quartile ROE and margins, prices in an AI data-center ramp that has not yet shown up in reported results.
Why these peers: AMD's revenue comes mainly from data center CPUs/GPUs/AI accelerators, client PC processors, gaming graphics and embedded FPGAs. The closest comps are fabless or IDM compute and AI silicon peers: NVDA and INTC as direct competitors, AVGO and MRVL in custom AI/data center silicon, QCOM and ARM in CPU/SoC IP and compute, MU for AI/data center memory exposure, and ALAB for AI data center connectivity.