Please ensure Javascript is enabled for purposes of website accessibility

Why AMD Stock Jumped Today

By Joe Tenebruso – Jul 22, 2020 at 6:39PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

New chips could mean bigger gains for the semiconductor company.

What happened

Shares of Advanced Micro Devices (AMD 1.31%) climbed 8.4% on Wednesday after the chipmaker announced a new line of desktop processors.  

So what

AMD's new Ryzen 4000 Series processors will be built on its "Zen 2" architecture and advanced 7-nanometer manufacturing process. They will integrate Radeon Graphics and are expected to deliver significant gains in performance and energy efficiency. AMD's processors are designed for the gaming and streaming markets, as well as mainstream consumers. A PRO class of chips, which contain high-end security features and other advanced technologies, is meant for the enterprise market.

A person is pointing to an upwardly sloping digital chart.

The debut of Advanced Micro Devices' new Ryzen processors helped to drive its stock higher on Wednesday. Image source: Getty Images.

Computer makers such as HP and Lenovo will begin including AMD's new processors in their PCs in the third quarter.

Now what 

The coronavirus pandemic is boosting demand for gaming systems as well as computers that can help people work efficiently from home. AMD and other PC component makers stand to benefit from these trends.

Moreover, if their improved performance and security features help AMD take share from rival Intel, today's gains could be just part of a potentially far larger upward move in AMD's stock price in the months ahead.

Investors will get an update on AMD's current sales trends and future growth expectations when it reports its second-quarter financial results on July 28. 

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool recommends Intel. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Advanced Micro Devices, Inc. Stock Quote
Advanced Micro Devices, Inc.
AMD
$67.17 (1.31%) $0.87

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
327%
 
S&P 500 Returns
105%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/27/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.