Wall Street has enjoyed significant gains of late with the Dow Jones Industrial Average (DJI) rising over 19,000 in a record-breaking rally. The gains enjoyed on equities markets are being felt across the board. Advanced Micro Devices, Inc. (AMD) stock received an upgraded rating of late but the stock price has been trading lower on Wednesday 23 November 2016. The stock was performing bullishly in the pre-market trading session, as it rose 0.46% or $0.04 to $8.73 per share. At current prices, the company has a market capitalization of $8.05 billion.

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Alphabet Inc., (GOOG) will be Using AMD Chips in 2017

Traders will note that the price/earnings ratio is unfavourable at -12.67, and the earnings per share (EPS) is -$0.69. The most important news for traders looking to cash in on this stock is that Google Inc., (GOOG) is going to be using AMD GPUs for the Alphabet Inc., Cloud Platform in 2017. The recent rally in AMD stock was bound to slow a little, and this is what we’re seeing taking place as Thanksgiving approaches. With US traders away from their desks and fund managers closing up shop for the weekend, a period of quiet is going to characterize markets. These pullbacks are not unusual and are not reflective of the fundamental strength or weakness of the stock.

What Other Technical Indicators Should You Be Looking at with AMD Stock?

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In terms of its 52-week trading range, the stock is closing in on its 1-year high of $9.22. The 52-week low is $1.75. In terms of analysts’ forecasts, a price of $6.91 is forecast over the next year. Despite the performance figures cited of late, there are analysts like Vetr Crowd that are bullish on the stock. They upgraded their rating of AMD from a 4 (Buy) to a 5 (Strong Buy). Motley Fool also recommends AMD stock as a great stock under $10. The reasoning behind this positive investor sentiment is the upside potential. At just $8.69 and thereabouts, the stock is priced right. The PE ratio is reflective of ‘underpricing’ which bodes well for strong profits.

Turning our attention back to the Vetr Crowd, their guidance on AMD stock has been boosted to $10.23. This is a significant upshot on the current price. Traders will feel emboldened by the bullish sentiment and likely want to cash in with call options over the short-term. Overall, analysts have pegged this stock price at $5.85 – significantly less than the prevailing price.

What Should We Expect from AMD Earnings? A Look to the Future from the Past

NASDAQ analysts have issued a buy rating on the stock. Advanced Micro Devices Inc., will be releasing earnings on January 17, 2016. According to Zacks Investment Research, the overall EPS consensus is -$0.04 for the upcoming quarter. This is significantly better than Q1 2016 when EPS of -$0.12 was posted. If we look at the quarterly earnings surprise history of AMD, we see some interesting earnings surprises:

• For the fiscal quarter ending in June 2016 and reported in July 2016, there was a 36.36% earnings surprise
• For the fiscal quarter ending in September 2016 and reported in October 2016 there was a 100% earnings surprise.

Did Corporate Bigwigs Lose Out on AMD Stock Rally Recently?

An interesting development took place with AMD stock recently. Company insiders sold off millions of shares before the stock popped. The selloff was proceeded by a sharp appreciation of 30% in the stock price earlier this week. The Chief Executive Officer (CEO) of AMD, Lisa Su, along with several other executives sold off some 2 million shares in November 2016 when the price was under $7. After that, Alphabet Inc., (GOOG) announced that it would be using AMD in its Cloud Platform in 2017. The stock popped to $9.22 on the back of the news. However, many executives sell stock for tax reasons as per the rules of the Securities Exchange Commission (SEC).