At $160, is it time to put Advanced Micro Devices, Inc. (NASDAQ:AMD) on your watchlist?

Over the past few months, Advanced Micro Devices, Inc. (NASDAQ:AMD) saw a double-digit share price increase of over 10% on the NASDAQGS. The recent share price rally has pushed the company in the right direction, although it still hasn’t reached its yearly high. Since many analysts cover large-cap stocks, we can expect that any price-sensitive announcements have already been factored into the company’s share price. But what if the stock is still a bargain? Today we’ll analyze the latest data on Advanced Micro Devices’ outlook and valuation to see if the opportunity still exists.

See our latest analysis for Advanced Micro Devices

How much are advanced micro devices worth?

Based on our discounted cash flow valuation, Advanced Micro Devices currently appears overvalued by 40%. The company’s stock is currently valued on the market at $160, while our intrinsic value is $114.43. This means that the opportunity to buy Advanced Micro Devices at a good price is gone! If you like this stock, you might want to pay attention to a potential price decline in the future. Since the Advanced Micro Devices share price is highly volatile, this may mean it could drop (or rise even further) in the future, giving us another opportunity to invest. This is based on its high beta, which is a good indicator of share price movement relative to the rest of the market.

Can we expect growth from Advanced Micro Devices?

Investors looking for growth in their portfolio may want to consider a company’s prospects before purchasing its shares. While value investors would argue that the most important thing is the intrinsic value relative to the price, a more compelling investment thesis would be high growth potential at a low price. With profits set to more than double over the next few years, the future looks bright for Advanced Micro Devices. It appears that higher cash flows are expected for the stock, which should translate into a higher share valuation.

What does this mean for you

Are you a shareholder? AMD’s optimistic future growth appears to have been factored into the current share price, with the stock trading above its fair value. At the current price, shareholders may be asking another question – should I sell? If you believe AMD should trade below its current price, selling at a high price and buying it back again when the price drops to its actual value could be profitable. However, before you make this decision, take a look at whether the fundamentals have changed.

Are you a potential investor? If you’ve been following AMD for a while, now may not be the best time to go public. The price has exceeded the actual value, which means there is no benefit to mispricing. However, the positive outlook makes AMD optimistic, which means it’s worth taking a deeper look at other factors to take advantage of the next price cut.

It’s worth considering what analysts expect from Advanced Micro Devices based on their latest forecasts. Fortunately, you can see what analysts are forecasting by clicking here.

If you are no longer interested in Advanced Micro Devices, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is of a general nature. We comment based on historical data and analyst forecasts, using only an unbiased methodology, and our articles are not intended to provide financial advice. It is not a recommendation to buy or sell any stock and does not take into account your objectives or financial situation. Our goal is to provide long-term, focused analysis based on fundamental data. Please note that our analysis may not reflect the latest price-sensitive company announcements or qualitative content. Simply Wall St has no position in any of the stocks mentioned.

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