Benzinga - by Benzinga Insights, Benzinga Staff Writer.
In the fast-paced and highly competitive business world of today, conducting thorough company analysis is essential for investors and industry observers. In this article, we will conduct an extensive industry comparison, evaluating Advanced Micro Devices (NASDAQ:AMD) in relation to its major competitors in the Semiconductors & Semiconductor Equipment industry. Through a detailed examination of key financial metrics, market standing, and growth prospects, our objective is to provide valuable insights and illuminate company's performance in the industry.
Advanced Micro Devices Background Advanced Micro Devices designs a variety of digital semiconductors for markets such as PCs, gaming consoles, data centers, industrial, and automotive applications, among others. AMD's traditional strength was in central processing units, CPUs, and graphics processing units, or GPUs, used in PCs and data centers. Additionally, the firm supplies the chips found in prominent game consoles such as the Sony PlayStation and Microsoft Xbox. In 2022, the firm acquired field-programmable gate array, or FPGA, leader Xilinx to diversify its business and augment its opportunities in key end markets such as the data center and automotive.
| Advanced Micro Devices Inc | 1262.73 | 4.08 | 10.20 | 0.54% | $1.13 | $2.75 | 4.22% |
| NVIDIA Corp | 66.06 | 37.18 | 27.79 | 30.42% | $10.96 | $13.4 | 205.51% |
| Broadcom Inc | 34.78 | 22.38 | 13.67 | 15.3% | $5.3 | $6.41 | 4.09% |
| Taiwan Semiconductor Manufacturing Co Ltd | 19.18 | 5 | 7.74 | 6.46% | $392.33 | $296.64 | -10.83% |
| Qualcomm Inc | 21.73 | 7.31 | 4.45 | 7.05% | $2.06 | $4.75 | -24.26% |
| Texas Instruments Inc | 21.69 | 9.14 | 8.47 | 10.44% | $2.34 | $2.81 | -13.53% |
| Analog Devices Inc | 30.01 | 2.74 | 8.08 | 1.39% | $1.18 | $1.65 | -16.36% |
| ARM Holdings PLC | 392.27 | 14.79 | 24.88 | -2.45% | $-0.12 | $0.76 | 27.94% |
| Microchip Technology Inc | 20.02 | 7.09 | 5.64 | 9.66% | $1.1 | $1.53 | 8.74% |
| STMicroelectronics NV | 10.76 | 2.92 | 2.71 | 7.28% | $1.69 | $2.11 | 2.55% |
| ON Semiconductor Corp | 16.89 | 4.82 | 4.51 | 8.05% | $0.87 | $1.03 | -0.54% |
| GLOBALFOUNDRIES Inc | 23.04 | 3 | 4.26 | 2.34% | $0.64 | $0.53 | -10.7% |
| United Microelectronics Corp | 9.09 | 1.81 | 2.68 | 4.72% | $29.0 | $20.46 | -24.3% |
| ASE Technology Holding Co Ltd | 16.70 | 2.07 | 1.02 | 3.06% | $28.07 | $24.92 | -18.27% |
| Skyworks Solutions Inc | 18.15 | 2.93 | 3.74 | 4.09% | $0.4 | $0.48 | -13.37% |
| First Solar Inc | 37.55 | 2.81 | 5.62 | 4.35% | $0.37 | $0.38 | 27.37% |
| Lattice Semiconductor Corp | 45.24 | 15.16 | 12.96 | 8.96% | $0.07 | $0.13 | 11.4% |
| Universal Display Corp | 44.30 | 6.54 | 15.48 | 3.77% | $0.06 | $0.11 | -12.13% |
| Rambus Inc | 26.19 | 7.72 | 16.41 | 10.86% | $0.12 | $0.08 | -6.19% |
| MACOM Technology Solutions Holdings Inc | 72.64 | 7.06 | 10.25 | 2.63% | $0.05 | $0.09 | -15.59% |
| Allegro Microsystems Inc | 23.60 | 5.38 | 5.58 | 6.18% | $0.09 | $0.16 | 15.92% |
| Average | 47.49 | 8.39 | 9.3 | 7.23% | $23.83 | $18.92 | 6.87% |
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.dividend-frequency { font-size: 12px; color: #6c757d; } Upon a comprehensive analysis of Advanced Micro Devices, the following trends can be discerned:
- Notably, the current Price to Earnings ratio for this stock, 1262.73, is 26.59x above the industry norm, reflecting a higher valuation relative to the industry.
- The current Price to Book ratio of 4.08, which is 0.49x the industry average, is substantially lower than the industry average, indicating potential undervaluation.
- The Price to Sales ratio of 10.2, which is 1.1x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.
- With a Return on Equity (ROE) of 0.54% that is 6.69% below the industry average, it appears that the company exhibits potential inefficiency in utilizing equity to generate profits.
- The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.13 Billion is 0.05x below the industry average, suggesting potential lower profitability or financial challenges.
- The gross profit of $2.75 Billion is 0.15x below that of its industry, suggesting potential lower revenue after accounting for production costs.
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With a revenue growth of 4.22%, which is much lower than the industry average of 6.87%, the company is experiencing a notable slowdown in sales expansion.
The debt-to-equity (D/E) ratio provides insights into the proportion of debt a company has in relation to its equity and asset value.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
When examining Advanced Micro Devices in comparison to its top 4 peers with respect to the Debt-to-Equity ratio, the following information becomes apparent:
- Advanced Micro Devices has a stronger financial position compared to its top 4 peers, as evidenced by its lower debt-to-equity ratio of 0.05.
- This suggests that the company has a more favorable balance between debt and equity, which can be perceived as a positive indicator by investors.
The low ROE of Advanced Micro Devices indicates that the company is not generating significant returns on its shareholders' equity. The low EBITDA suggests that the company's operating profitability is relatively weak. The low gross profit indicates that the company's cost of goods sold is high compared to its revenue. The low revenue growth suggests that the company's sales are not growing at a significant rate.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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