After a brutal year in the semiconductor space, things are starting to look up We’re coming around the corner By 2023 Nvidia Corporation (NASDAQ: NVDA) And Advanced Micro Devices, Inc. (NASDAQ: AMD ) Both have seen their shares rise throughout the quarter so far.
As thoughts turn to ham and what might be left under the tree, it’s always good for investors to consider how their portfolios will fare in the coming year. Semiconductor Industry Bill A hot one In the coming years, we’ll look at some of the reasons against each of the two heavyweights.
Nvidia’s stock wants to run
Its shares rose as much as 160% in 2021, but investors had to grit their teeth as the Jensen Huang-led company’s shares fell 70% in October this year. Still, it’s starting to look like it may have been priced lower, and the stock’s recent performance now gives it plenty of food for thought.
It has set high lows and high highs in two months, making it one of the most elegant technical patterns out there. It tells us that each dip is bought more aggressively and quickly than the last, and that each pop is sold lower and lower. They are on the verge of peaking in August A significant milestone The road will open again for $200.
Basically, there are also positive signs of a pullback. Last month, the Wedbush Securities Group called NVIDIA’s “top position” in artificial intelligence and highlighted the long-term potential for the company. To outperform peers. Constant headwind form of inflation And Supply chain issues They and their counterparts have been detained outside of China this year, and both look set to disappear by 2023. Against AMD, Wedbush called NVIDIA the “clear leader.”
Advanced micro devices seem cheap
That’s not to say it doesn’t have a chance with NVIDIA’s neighbors from the street, but it feels very muted. While AMD shares It didn’t fall that much This year for NVIDIA, they’re not as mobilizing as they are in 2021. And since October, it’s only up 35% compared to NVIDIA’s 65%.
However, that didn’t stop both Wedbush and Baird from setting new price targets of $100 on their shares. In recent weeks. Even from where shares closed on Tuesday, that still represents 40% upside potential. Both are fans of the recently announced Genoa server offering, which they expect will translate into greater market share gains and higher gross margins.
Those in the bull camp will also point to AMD’s price-earnings ratio of 43, which compares favorably to NVIDIA’s 77, making it relatively cheap. The laggard, AMD, is poised to do most of the work given the strength of the industry as a whole.
Between the two of them, you really can’t go wrong getting exposure to an industry that Credit Suisse considers to be on the verge of “sustainable long-term growth.” Chris Gaso and his team there recently acknowledged the viscous correction that stocks have gone through this year, but feel that further downside from here is limited.
Choosing between them is like choosing two thorn bushes grown in the same field. Based on trading performance alone, NVIDIA is more likely to outperform in a straight shootout in the right environment, but investors will feel they’re getting a bargain with AMD.
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