Advanced Micro Devices (AMD): Reiterating Outperform After Offerings Improve Balance Sheet - Wells Fargo
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Wells Fargo analyst, David Wong, reiterated his Outperform rating on shares of AMD (NASDAQ: AMD) after the company announced 2 public offerings: 1) $600
million of common stock and 2) $450 million of convertible senior notes. AMD plans to use the net proceeds of $1.02 billion to repay borrowings under its credit facility and/or to purchase its outstanding senior notes.
The analyst stated "We think that this latest announcement from AMD to issue new stock and
convertible notes brings additional cash into the company, further strengthening
its balance sheet. We think that AMD will achieve ongoing business momentum
over the next few quarters: 1) Continuing to gain graphics share with ramping
sales of its latest generation of GPUs (graphics processor units) – the Polaris
family, 2) Reporting additional revenues streams from new semi-custom
products, beginning in the 2nd half of 2016, and 3) Re-engaging in the x86 server
processor market in 2017 with its new Zen-based server processor family, Naples."
No change to the valuation range of $8 - $10.
Shares of AMD closed at $7.34 yesterday.
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