Why Advanced Micro Devices Stock Gained 10% in September

Source The Motley Fool

Shares of Advanced Micro Devices (NASDAQ: AMD) were moving higher last month as the result of a number of news items, the Federal Reserve's 50-basis-point cut, and a general tailwind in the semiconductor sector.

According to data from S&P Global Market Intelligence, the stock finished the month up 10%. As you can see from the chart below, the stock's movement mirrored that of the VanEck Semiconductor ETF, but it gained at a higher rate, showing that while it was subject to the same trends as its industry, it was able to outperform it.AMD Chart

AMD data by YCharts

AMD gets an edge

AMD has generally been a winner in the AI boom, though the company is only just starting to assert itself as a key supplier with its MI300 data center GPU, which saw strong growth in the second quarter.

In September, several small news items made the stock a winner.

First, AMD announced its "Advancing AI 2024" event, scheduled for Oct. 10. The company plans to show off its next-generation AMD Instinct accelerators and fifth-gen AMD Epyc server processors.

It's no secret that artificial intelligence (AI) has taken center stage in the chip sector, and investors are paying close attention to AMD's AI product offering. The stock jumped 5% on Sept. 11 on high volume following that announcement.

Cathie Wood's Ark Invest also added to its AMD holdings, purchasing 45,500 shares that week, a positive sign for investors who closely follow her moves.

The following week, Reuters reported a victory over Intel to design a key chip for Sony's PlayStation 6, and Citigroup reiterated AMD as a top AI pick. AMD also got a boost on the Fed's rate cut, gaining 4.5% on Sept. 19, along with a broader upswing in the market.

Finally, AMD scored another win toward the end of the month as Oracle Cloud Infrastructure said it would use AMD's Instinct MI300X accelerators, a key win for the new chip, which competes with Nvidia's AI accelerators.

A semiconductor being made.

Image source: Getty Images.

What's next for AMD?

All eyes will be on the Oct. 10 AI presentation, and the stock is likely to move on the news. Investors will be expecting some new products that can move the needle for AMD, especially as it looks best positioned to challenge Nvidia in the data center GPU market.

If AMD can execute on that opportunity, the stock could have a lot of room to run from here.

Should you invest $1,000 in Advanced Micro Devices right now?

Before you buy stock in Advanced Micro Devices, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Advanced Micro Devices wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $752,838!*

Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.

See the 10 stocks »

*Stock Advisor returns as of September 30, 2024

Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Japanese Yen stands tall near one-month top against USD on hawkish BoJ talksThe Japanese Yen (JPY) rallied to the highest level since early February against its American counterpart on Friday amid bets for an imminent shift in the Bank of Japan's (BoJ) policy stance.
Author  FXStreet
Mar 11, Mon
The Japanese Yen (JPY) rallied to the highest level since early February against its American counterpart on Friday amid bets for an imminent shift in the Bank of Japan's (BoJ) policy stance.
placeholder
Natural Gas sinks to pivotal level as China’s demand slumpsNatural Gas price (XNG/USD) edges lower and sinks to $2.56 on Monday, extending its losing streak for the fifth day in a row. The move comes on the back of China cutting its Liquified Natural Gas (LNG) imports after prices rose above $3.0 in June. It
Author  FXStreet
Jul 01, Mon
Natural Gas price (XNG/USD) edges lower and sinks to $2.56 on Monday, extending its losing streak for the fifth day in a row. The move comes on the back of China cutting its Liquified Natural Gas (LNG) imports after prices rose above $3.0 in June. It
placeholder
Dogecoin Path To $23? Fibonacci Extensions Hint At Massive Upside With Musk-Trump InfluenceElon Musk’s favorite cryptocurrency, Dogecoin (DOGE), could be on the verge of a massive parabolic rally following the recent victory of Republican U.S. presidential candidate Donald Trump.
Author  NewsBTC
23 hours ago
Elon Musk’s favorite cryptocurrency, Dogecoin (DOGE), could be on the verge of a massive parabolic rally following the recent victory of Republican U.S. presidential candidate Donald Trump.
placeholder
Is It Time to Buy Berkshire Hathaway Stock as the Company Builds Its Cash Stockpile?Unlike most companies, Berkshire issues its results during weekends, giving investors plenty of time to digest the results. Warren Buffett also shuns quarterly earnings conference calls, instead preferring to meet investors once a year at its annual shareholder meeting.
Author  The Motley Fool
23 hours ago
Unlike most companies, Berkshire issues its results during weekends, giving investors plenty of time to digest the results. Warren Buffett also shuns quarterly earnings conference calls, instead preferring to meet investors once a year at its annual shareholder meeting.
placeholder
Trump's Return to the White House Fuels Market Rally​Insights — Trump's re-election has sparked a surge in financial markets. S&P 500 futures rose 2%, the US dollar strengthened, and Bitcoin briefly hit a record high of $75,000.
Author  Mitrade
20 hours ago
​Insights — Trump's re-election has sparked a surge in financial markets. S&P 500 futures rose 2%, the US dollar strengthened, and Bitcoin briefly hit a record high of $75,000.
goTop
quote