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Alright folks, let’s talk about Advanced Micro Devices, also known as AMD. They were the hot topic on Wall Street not too long ago, but now another chipmaker has taken the spotlight. However, there’s something brewing here that should keep AMD stock investors interested.
The big buzz in 2023 has been the artificial intelligence (AI) chip wars. Unfortunately, AMD isn’t at the top of the pack in this field. But hold on, don’t count them out just yet. There’s a chance they could catch up to their rivals.
AMD Stock Soars but Then Stalls
Earlier this year, AMD stock was on fire, soaring from $64 to $128. It looked like nothing could stop them. But then, traders shifted their attention to Nvidia and the price of AMD stock retreated back to around $100.
As we all know, the market is fickle. It’s always searching for the next shiny thing. There’s nothing wrong with AMD as a company, it’s just that investors got caught up in the hype surrounding AMD’s competitors in the AI chipmaker space, particularly Nvidia.
Analyst Tristan Gerra expressed concerns about AMD’s ability to compete in the AI chip market. He believes Nvidia’s leadership will create some challenges for AMD in the future. But hey, there’s a way to hedge your bets. You could own both AMD stock and NVDA stock.
AMD Escalates the War With an AI Startup Acquisition
Now, Gerra doesn’t seem too worried about AMD’s future prospects overall. In fact, he assigned an “outperform” rating on AMD shares. But here’s where it gets interesting. AMD just announced a major move that shows they’re not backing down.
They made a definitive agreement to acquire Nod.ai, a move that will expand AMD’s AI software capabilities. This will help them deploy AI solutions optimized for their data center accelerators and other products. It’s a clear sign that AMD is going after their rivals, especially Nvidia. The AI-compatible technology war is far from over, my friends, and AMD wants to stay in the fight.
A Hedging Strategy for AMD Stock
Look, Nvidia may be the market darling at the moment, but that doesn’t mean there isn’t room for more than one AI component maker. Still, we have to respect Nvidia’s dominance in the field right now. So here’s what I suggest: own AMD stock, but also balance it out with an equal-sized stake in NVDA stock. That way, you’re riding the wave of both high-conviction AI chipmakers.
Now, I gotta give you the disclaimer: I don’t have any positions in these securities. These are just my opinions, folks.