The other shoe just dropped on Advanced Micro Devices (NYSE: AMD). It didn't really hurt much, because the first one had already tenderized the stock quite thoroughly.

The company just updated revenue guidance for the third quarter, which closes the books over the coming weekend and will be properly reported on Oct. 14. It's not good news at all, but the stock is taking it in stride and barely moving in either direction.

AMD's original guidance called for revenue to rise in a typical seasonal pattern, about 8% above second-quarter sales of $1.65 billion. It made sense at the time, because the entire food chain of the computer industry appeared to be in great shape.

Times have changed. Cisco Systems (Nasdaq: CSCO) sent early signals of trouble ahead with a meek earnings outlook in mid-August. NVIDIA (Nasdaq: NVDA) did the same, though its troubles appeared to have started much earlier than Cisco's and felt more like a problem that was uniquely NVIDIA's.

Then Intel (Nasdaq: INTC) lowered its third-quarter guidance by a few percent, citing weak consumer sales, and all hell broke loose.

That watershed report dragged AMD's share price down amid the general semiconductor and IT sector panic, and that's why the stock isn't sliding today. In fact, AMD's stock is actually up; the bad news was already obvious. Oh, and don't forget about Oracle announcing they're hungry for chip makers; that's helping, too.

Like Intel, AMD points to slow consumer demand for notebooks in North America and Europe, and now sees the quarter trending down by 1% to 4% when compared with the previous period. Oh well.

In spite of this negative update, the fact still remains that AMD is worth more than you're paying for it these days. You would have to assume a permanent IT recession in order to justify prices below $10 per share, and the stock is trading at a significant discount to that.

The day before AMD's update, Doug Freedman of analyst firm Gleacher & Co. lowered his price target on the stock from $16 to $12, citing "ubiquitous data points (affirmed by Intel)" and a weak back-to-school season. He recommends using this period of low share prices and unimpressive reports to "accumulate" a position in AMD. I couldn't agree more.

If you're not ready to take the plunge with real money, you can always start a CAPS position in AMD or at least add the stock to My Watchlist so you can keep track of what's happening. By this time next year, you'll be glad you did.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. Intel is a Motley Fool Inside Value selection. NVIDIA is a Motley Fool Stock Advisor pick. The Fool has written calls (Bull Call Spread) on Cisco Systems. Motley Fool Options has recommended buying calls on Intel. The Fool owns shares of Intel. Try any of our Foolish newsletter services free for 30 days. True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.