The past five years have been fruitful for Advanced small devices(Nasdaq: AMD) Investors invest, as an investment of $ 1,000 in shares half a decade ago, approximately $ 2200 until this writing.
However, to put matters in its right quorum, jumping by 118 % in AMD shares in the past five years is less than the 178 % jump that records it. The semiconductor sector phlx Index during the same period. Last year was especially difficult for AMD investors, with 41 % of its value during this period. This significant decline can be attributed to the inability of AMD to take advantage of the prosperous demand Artificial Intelligence (AI) Chips, market where the arc competitor Nafidia I created a dominant position.
After that, the last AMD results were strong, and it has the company more than a catalyst that can help revive the securities market wealth over the next five years. We will take a closer look at the potential growth drivers of AMD and check why there is a good idea to buy and keep this shares over the next five years.
AMD's financial performance has been mixed over the past five years. While the company's revenues and profits increased in 2020, 2021 and 2022 due to strong sales of central processing units (CPU) and graphics cards used in PCS, their basic growth fades after a strong start.
This is because The demand for computers faded After strong sales in the years of Pandemin virus. AMD was left with the excess stock on his hands, and he had to write it, which led to a sharp decrease in the company's profits. Meanwhile, the company's data center works were in good condition throughout this period as it continued to obtain the participation of the CPU from the CPU from Intel.
But then, sales of keyboards from games Sony and MicrosoftThat are run by semi -extended AMD processors, began to mature and lead these technology giants to submit a fewer requests. Throw the fact that AMD is behind NVIDIA on the market for gaming graphics cards, with only 10 % stake; It is easy to know why the company's gaming business is struggling for traction.
Therefore, the mixed performance of various AMD companies has been affected by the performance of stocks over the past five years. However, the good news is that all sectors that have been discussed above are likely to have a strong growth over the next five years, paving the way for more bullish trend in AMD Stock.
The AMD performance over the next five years depends on the health of the main sectors such as games, data centers and computers. The good part is that all these business sectors are likely to have secular growth thanks to the various catalysts.
For example, the company's games should benefit from the arrival of the new keyboards from Microsoft and Sony. The generation of the current control unit is close to five years. One of them is likely to reach the next two years to three years, with Sony and Microsoft historically released a new generation of keyboards every seven to eight years.
Sony and Microsoft are expected to release keyboards from the next generation in 2026 or 2027. This may give the semi -designated AMD chips work with a nice batch as it was chosen by the console makers to supply processors with the next generation control devices.
Moving from games to computers, AMD has already started watching a strong preposition in this market. The company's customer sector revenue increased by 52 % in 2024 to $ 7.1 billion, thanks to “the strong demand for AMD Ryzen processors on the desktop and mobile.” It seems that the possibilities of the computers market during the next five years are bright due to the emergence of artificial intelligence.
According to one of the estimates, the AI PC market revenues are expected to jump by 5X between 2024 and 2030. This promises good for long -term AMD prospects, especially since the company has gained a greater share in the computer processor market. Chipmaker 2024 with nearly 25 % of the CPU market ended the customer under its control, an increase of approximately five percentage points from the previous year period, according to Mercury Research.
The share of its revenue from the client computers market has grown faster, with 8.4 percentage points on an annual basis. This indicates the improvement of the AMD pricing power in the computer processor market, as its revenue share improves at a faster pace than the unit. Moreover, it will not be surprising to see AMD gaining more market share as it is not expected to launch the intel competition intel the new CPU for the desktop until next year.
As such, it seems that the stage is ready for health growth in the AMD and computers games sectors over the next five years. At the same time, the company's data center works also improve, although it plays a second role to NVIDIA in the graphics processing market). The AMD Data Center revenue last year has multiplied to $ 12.6 billion, driven by strong sales for each of its central processing units and GPU.
The company sold at least $ 5 billion of graphics processing units at the Data Center in 2024. AMD expects GPU to grow in the data center to “tens of billions, where we are going through the next two years.” In fact, AMD can record solid revenues in the graphics processing units in the long -term data center, even if you can park a small part of this market for itself.
In the end, we can conclude that AMD seems to be the outstanding profit growth over the next five years. That is why buying this stock seems to be not thinking at the present time, especially given the price/profit ratio (PEG) of only 0.42 based on the expected profit growth for five years, according to Yahoo! finance.
The PEG ratio, which is less than 1, means that the shares are less than their value in light of the growth that is expected to offer, and that AMD is circulating much lower than that threshold. Therefore, investors looking to buy a growth share that is traded at attractive levels of thinking in adding AMD to their wallets. This stock appears to be in favor of the impressive upper trend.
Have you ever felt that you missed the boat in buying the most successful stocks? Then you will want to hear this.
On rare occasions, our expert team issues an analyst A. “Double Permanent” stock A recommendation for companies they believe is about to pop. If you are worried that you have already missed your chance to invest, it is now the best time to buy before it is too late. And the numbers speak for themselves:
Nafidia:If you invest $ 1,000 when we doubled in 2009,You will have $ 323,920!
apple: If you invest $ 1,000 when we doubled in 2008, You will have $ 45,851!
Netflix: If you invest $ 1,000 when we doubled in 2004, You will have 528,808 dollars!
Currently, we make “Double Download” alerts for three incredible companies, and there may not be another chance like this any time soon.
*The stock consultant dates back from February 24, 2025
Hald Johann He has no position in any of the mentioned stocks. Motley Fool has parking lots in advanced, Intel, Microsoft and Nvidia. The Motley Fool recommends the following options: since January 2026, $ 395 on Microsoft, February 2025, $ 27 on Intel, and short in January 2026 $ 405 calls on Microsoft. Motley deception has Disclosure.
