Why AMD Is Poised to Keep Plunging

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, embattled chip maker Advanced Micro Devices (NYSE: AMD  ) has received a distressing two-star ranking.

With that in mind, let's take a closer look at AMD and see what CAPS investors are saying about the stock right now.

AMD facts

Headquarters (founded)

Sunnyvale, Calif. (1969)

Market Cap

$1.7 billion

Industry

Semiconductors

Trailing-12-Month Revenue

$6.0 billion

Management

CEO Rory Read (since 2011)

CFO Devinder Kumar (since 2012)

Return on Capital (average, past 3 years)

(1.3%)

Cash/Debt

$1.3 billion / $2.0 billion

Competitors

Intel

IBM

NVIDIA

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 18% of the 3,770 members who have rated AMD believe the stock will underperform the S&P 500 going forward.

Just yesterday, one of those Fools, All-Star MrOneHundred, touched on the headwinds working in the stock's favor:

It's hard to imagine AMD driving any lower than it is presently, but with a PC dying market and tremendous competition in the microprocessor market with Intel, the last bastion of hope (IMO) is AMD's video graphics cards (which I personally happen to like). I'm sure I'll be attacked on this, but if AMD is to survive the mobile/tablet revolution (of sorts), then it will need to either cut back on some of its operations or develop products that can take advantage of the market's direction. This pick is meant for the long term. An initial climb back up is probably inevitable, but I'm not going to risk it with real cash.

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Read/Post Comments (6) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 23, 2013, at 7:26 PM, TEBuddy wrote:

    Seriously, we have an aritcle with such a terrible and pointed title, which is completely false, and the content is only a comment from a member?

  • Report this Comment On January 23, 2013, at 8:20 PM, dhe123 wrote:

    what is the consequence for the author if the conclusion is proved to be wrong in the future? nothing? that is why all those analysts give you all those biased point of views without any responsibilities, such as put into jails or fined 1 million dollars

  • Report this Comment On January 23, 2013, at 9:12 PM, F00LME0NCE wrote:

    All of the churning about a dying PC market due to the fad of low-processing power phones and tablets with their compact and limited-functionality operating systems is foolish fodder aimed to create unfounded doubt about a CHIP MAKER that does not even produce PCs. It is like saying that mp3 players and earbuds will spell doom for the home stereo market. The PC UI (Windows 8) and PC configuration will adapt to be more trendy and will be owned by EVERY tablet user for when then need a real computer for business, gaming, or just plain speed and horsepower. AMD APUs are the future and the future is now.

  • Report this Comment On January 23, 2013, at 9:37 PM, FM5 wrote:

    People are getting out of hand, most businesses are not running off an i pad, i phone , Everyone will still need PC's, So AMD Will be going UP, and now thay have the engineers from apple coming on bord the Great changes will be made, this low price in the stock for AMD was a wake up call, and the alarm went off, its all about work for AMD to be the best now, the come back will be soon

  • Report this Comment On January 24, 2013, at 7:09 AM, scottyherb wrote:

    Constant negative comments about AMD....they are still very respected & have a great future down the pipe....gaming...teaming with Microsoft.Vizio.Sony...faster speeds....awards....and bringing on Talent from Apple & Microsoft...i thank the Motley Fool for driving the price down...and when it goes up?.....................thanx

  • Report this Comment On January 24, 2013, at 12:40 PM, TEBuddy wrote:

    This place needs a rating on articles, thumbs up, thumbs down, and if its weighted extremely negative it gets trashed.

    For some reason the comments section of several Fool articles is also jacked up on any computer I try it on. The ones powered by Disqus are not working right.

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