Is It Time to Sell AMD?

Summary

Earn Your Leisure Podcast: “Is It Time to Sell AMD?”

Release Date: April 22, 2025
Hosts: Rashad Bilal and Troy Millings
Episode Title: Is It Time to Sell AMD?
Podcast Description:
Earn Your Leisure offers an insightful blend of financial perspectives within the entertainment and sports industries, spotlighting entrepreneurial backstories, dissecting business models, and exploring the latest financial trends. Hosted by Rashad Bilal and Troy Millings, the podcast serves as a unique fusion of a college business class and pop culture, delivering an engaging look into the business world.

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Episode Overview

In this episode, Rashad Bilal and Troy Millings delve into the current state of Advanced Micro Devices (AMD), exploring whether now is the optimal time to sell off investments in the company. The discussion navigates through AMD’s market positioning, competitive landscape, technical analysis, and the broader economic factors influencing its stock performance.

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Discussion Sections

1. AMD’s Market Position and Historical Performance

The conversation begins with a critical assessment of AMD’s historical standing in the semiconductor industry.

Market Analyst 1:
"Is it time to sell AMD?"
[01:12]

Market Analyst 2 reflects on AMD’s legacy as a favored company among investors, sharing a personal shift in preference towards Nvidia:

“AMD has historically been one of my favorite companies of all time. And before I was an Nvidia fanboy, AMD probably led that position.”
[01:23]

This shift underscores the evolving preferences and competitive dynamics within the semiconductor sector.

2. Competitive Landscape: The Mount Rushmore of Chipmakers

A significant portion of the discussion centers on identifying the leading players in the chipmaking industry, metaphorically referred to as the "Mount Rushmore."

Market Analyst 2:

“Nvidia. Yeah. TSM. ASML. Broadcom. Qualcomm better too, if we're gonna be real.”
[02:14]

The analysts debate which companies deserve a spot among the top four, highlighting AMD’s diminishing dominance in the face of rising competition from giants like Nvidia, TSMC, ASML, Broadcom, and Qualcomm.

3. Technical Analysis: Stock Performance and Moving Averages

The analysts delve into AMD’s stock performance, focusing on technical indicators such as moving averages to gauge future trends.

Market Analyst 3:

“The 400 EMA is 78, 76. And so we're talking back to 2021. And if you look at that chart you could be saying, alright, there's some room for optimism.”
[04:18]

The discussion highlights that AMD’s stock is currently below key exponential moving averages (EMAs), suggesting a bearish trend. The analysts express skepticism about an imminent uptrend, drawing parallels with past performances where similar technical patterns preceded further declines.

4. Economic and Political Influences

Broader economic and political factors are identified as critical influencers on AMD’s prospects.

Market Analyst 2:

“Given the climate that we're in with the policies, tariffs, Trump versus Powell, the thing that is great about it is that we are entering generational buying opportunities.”
[02:47]

However, uncertainty remains due to ongoing policy shifts and tariffs affecting the semiconductor industry. The potential for AMD’s strategic moves, such as manufacturing GPUs solely in the United States, is also discussed, though its impact remains ambiguous.

5. Potential Opportunities and Future Outlook

Despite the bearish sentiment, the analysts acknowledge potential opportunities for AMD if specific conditions are met.

Market Analyst 2:

“If it ever got to 25.82, I would probably put a considerable amount of money there. Mid six figures, probably.”
[02:48]

They speculate on significant price drops as buying opportunities but caution that such scenarios are uncertain. The importance of evaluating market and economic turnarounds before making investment decisions is emphasized.

6. Risk Management and Investment Strategy

The conversation transitions into a broader discussion on the risks associated with investing in individual stocks like AMD versus diversified index funds.

Market Analyst 1:

“It's extremely dangerous to invest in individual stocks because even if every like Facebook, we've seen two stocks go up and come down historically Facebook back to damn near back to his 52-week low if it's continued to trend for another week.”
[06:41]

The analysts advocate for a defensive investment strategy, prioritizing safety and diversification to mitigate risks inherent in volatile individual stocks.

7. Concluding Insights

The episode concludes with a consensus on the precarious state of AMD’s stock and the necessity for cautious investment approaches amid volatile market conditions.

Market Analyst 2:

“It's dangerous times right now.”
[08:31]

They reiterate the importance of playing defense in investment strategies and remain uncertain about AMD’s short-term prospects, indicating a wait-and-see approach in the months ahead.

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Key Takeaways

• Competitive Pressure: AMD is facing increased competition from leading semiconductor companies, which may impact its market share and stock performance.

• Technical Indicators: Current technical analysis suggests a bearish trend for AMD, with the stock trading below significant moving averages.

• Economic Uncertainty: Political factors, including policies and tariffs, create an unstable environment for AMD and the broader semiconductor industry.

• Investment Risk: Investing in individual stocks like AMD carries substantial risk, especially in volatile markets. Diversification and defensive strategies are recommended.

• Potential Opportunities: Significant price drops in AMD’s stock could present buying opportunities, but these are contingent on favorable market and economic conditions.

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Notable Quotes

• Market Analyst 2:

  “AMD is entering, I don't want to say it, but intellish like territory of a bear drop.”
  [02:25]

• Market Analyst 3:

  “Well, this is bearish territory over the past 12 months and I'll lead with this.”
  [03:36]

• Market Analyst 1:

  “It's extremely dangerous to invest in individual stocks because even if every like Facebook, we've seen two stocks go up and come down historically Facebook back to damn near back to his 52-week low if it's continued to trend for another week.”
  [06:41]

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Conclusion

The episode "Is It Time to Sell AMD?" provides a thorough analysis of AMD’s current market situation, highlighting significant challenges and uncertainties. The hosts and analysts advise caution, emphasizing the risks associated with individual stock investments in volatile industries. While potential opportunities exist, they are contingent upon broader economic and market improvements. Investors are encouraged to adopt diversified and defensive strategies to navigate these uncertain times.

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Transcript

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[Market Analyst 1]

Code [e-mail] amd yeah, is it time to sell AMD?

[Market Analyst 2]

AMD has historically been one of my favorite companies of all time. And before I was an Nvidia fanboy, AMD probably led that position. But I think it's time to have a conversation if it's time to cut loose. And I think yes, if, if AMD gets to 53.16, I would then want to reposition in. But when I'm looking at an investment, a of course I'm always looking at to build. Like you said, build a table. Right. So who are the four in that space? And if we're going to be honest, AMD is not on the Mount Rushmore of chipmunkers anymore. They have some considerable competition. I'm not sure.

[Market Analyst 1]

Say what.

[Market Analyst 3]

Who's on Mount Rushmore? Is this route. That's like the thing now. Who's in Mount Rushmore?

[Market Analyst 2]

Nvidia. Yeah. Tsm.

[Market Analyst 3]

Okay.

[Market Analyst 2]

Asml. I Procom for sure. Qualcomm.

[Market Analyst 3]

Okay.

[Market Analyst 2]

No, no.

[Market Analyst 3]

Oh, you said Qualcomm. I said Broadcom.

[Market Analyst 2]

Oh, Broadcon them too. Qualcomm better too, if we're gonna be real.

[Market Analyst 3]

All right, cool. That's fair.

[Market Analyst 2]

AMD is entering, I don't want to say it, but intellish like territory of a bear drop. So if I look, they've had seven negative months.

[Market Analyst 3]

Yeah.

[Market Analyst 2]

In a stock. So at this point, unless you're getting it at a historic low. Because now given the climate that we're in with the policies, tariffs, Trump versus Powell, the thing that is great about it is that we are entering generational buying opportunities. But I don't think we've gotten there yet. So 55, 16 is one level that I do like it. If it ever got to 25.82, I would probably put a considerable amount of money there. Mid six figures, probably. But as of right now, I would not leg into AMD until the market and global economy turns around.

[Market Analyst 3]

Well, I guess I gotta appreciate that you didn't say they were dead. I appreciate it.

[Market Analyst 2]

We'll take that, of course. No, no, not dead, just injured.

[Market Analyst 3]

Yeah, this is, this is bearish territory over the past 12 months and I'll lead with this. Nvidia. Before I had a thousand shares in Nvidia, AMD was the company that was my thousand shares. I sold some probably when I think we got down to like 113 which was. All right, well let's take profit. My buy in for everybody was $75 and we're approaching 75 here. And it's interesting you said the $55 range, which is crazy because if you go out on the five year chart and you look at the trend line, it makes a lot of sense why you said that. Yeah, but yeah, it's below all of our EMAs that we talk about on market Mondays. Whether it's the 50 day, whether it's the 100 day, 200. On the yearly, the 400 day moving average was 78, 76. And so we're like floating right above, well, 113. I'm sorry, on the one year, on the five year chart, check this out.

[Market Analyst 2]

Yeah.

[Market Analyst 3]

400 EMA is 78, 76. And so we'RE talking back to 2021. And if you look at that chart you could be saying, all right, there's some room for optimism. Right. In 2021 when it hit this low level or it touched that 400 EMA, we saw a bounce up and then we still pull back in 2022. And so now we watched what happened in 2024 and that drop now and we're about to hit the 400 day again. Is there an uptrend? Well, no, I would feel confident about it if there wasn't. So Much uncertainty around semiconductors and especially what the President is doing. I guess the only bright news and we kind of talked about a little bit is when we're talking about America first in terms of chips, they're the first company to step up and saying like we're going to be the first ones to make our GPU solely here in the United States. I don't know what that's going to mean. Especially when the GPU market, I mean it's going to be dominated by Nvidia for the next five years. They will be number two. And we kind of like talked about price points a little before we came on camera. That will be to me the only way that they can break ground in that race for GPUs is to have a price point that's affordable, that makes sense to small cap to new business startups in terms of GPU compute. So I still have the shares, I still have some calls out to 2027 on them. So we'll see what happens in the next few months when in terms of the uncertainty with, with the semis. I know they're supposed to be a tariff coming on them but yeah, if I'm doing it today, I like the level. You said 78 would be a level that it's all right. Well you know what if I haven't invested it before, this might be a good opportunity. But yeah, I can't see it going down to 25 for sure. If we get, if we get lower than 75 then we're dropping down to the 60s for sure.

[Market Analyst 2]

So Rashad, you want to go to your theory about you had to take.

[Market Analyst 3]

It a year about a pricing. Let's go there. Yeah, let's go there.

[Market Analyst 2]

Well let's see if he wants to because he may not like he wants to say what you checking in my warriors?

[Market Analyst 1]

Well, it's one of these things before we go to AMD. AMD is down 55.

[Market Analyst 3]

Yep. Plus bearish.

[Market Analyst 1]

It's beyond bearish. That's polar bearish. But also this goes back Kodiak for real. This goes back to the theory of individual stocks are very risky. It's not a good idea to invest in individual stocks. Even Ian when he says like two text to index, it's only two stocks. It's extremely dangerous to invest in individual stocks because even if every like Facebook, we've seen two stocks go up and come down historically Facebook back to damn near back to his 52 week low if it's continued to trend for another week. Tesla, we saw that skyrocket so it's like even a good company, you never know. Economic environment, political environment, it's safer to invest in an index fund or etf. It's just, it's. It's you. You're playing a very dangerous game when you're putting money in the individual stocks, especially substantial amount of money. Yeah, that's not. That's dangerous. And AMD is a company that, yeah, it's just down damn near 60%. That's dangerous. Right? Like if you have a lot of money in there or if you trade in. Because if you trade in, you're going to lose me more. So I think that this is highlights that if you want the chips smh smh not is not down as much as that. Right. Like it's just a safer way to go about it. And the number one rule is safety first. Like you always you gotta play defense. Aoi's gotta play defense. So we'll see what happens with amd. But yeah, it's dangerous times right now.

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