What happened

Shares of Advanced Micro Devices (NASDAQ:AMD) gained 32.2% in January of 2019, according to data from S&P Global Market Intelligence. The price increase hinged on AMD's solid fourth-quarter report at the very end of last month.

So what

In the fourth quarter of 2018, AMD saw sales rise 6% year over year to $1.42 billion. On the bottom line, adjusted earnings increased from $0.01 to $0.08 per share. The revenue result landed just below analyst expectations, while earnings met Wall Street's expectations. The microchip designer also guided first-quarter revenue 24% below the year-ago period's reading.

If all of this sounds more like reasons for a plunging stock than a big gain, you're absolutely right. However, AMD also guided full-year revenue to "high single-digit percentage" growth thanks to an upcoming slate of data center and high-end PC processors. That longer-range optimism was enough to light a fire under AMD's stock.

Check out the latest AMD earnings call transcript.

Gold-colored microprocessor on a white background

There's gold in those chips. Image source: Getty Images.

Now what

AMD's investors have enjoyed a mind-boggling 1,000% return over the last three years. The stock is trading at nosebleed-inducing valuation multiples such as 39 times forward earnings estimates and 129 times trailing free cash flow. That's impressive for a company projecting no more than single-digit revenue growth for the next year alongside unpredictable bottom-line margins.

I'll just keep watching AMD from the sidelines, thank you very much.