Goldman Sachs Maintains a 'Sell' on AMD (AMD); Not Just PC Weakness, Now Market Share Concerns Too

July 10, 2012 9:22 AM EDT
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Goldman Sachs maintains a 'Sell' on AMD (NYSE: AMD) price target of $5.50 (from $6.25).

Analyst, James Covello, said, "AMD negatively preannounced 2Q results. It now expects revenue to be down 11% qoq ($1,411 mn), well below original guidance of flat to up 6%, the Street at up 3% qoq ($1,629 mn) and GS at up 1% qoq ($1,600 mn). AMD attributed the shortfall to weaker channel sales in China and Europe, and lower consumer PC purchases that developed late in the quarter."

Covello said there is longer-term concern as NVIDIA (Nasdaq: NVDA) and Qualcomm (Nasdaq: QCOM) enter the market and Intel's (Nasdaq: INTC) recent minority stake in ASML (Nasdaq: ASML). He lowers AMD's FY12 EPS estimate from $0.70 to $0.42 and FY13 from $0.80 to $0.70.

For an analyst ratings summary and ratings history on AMD click here. For more ratings news on AMD click here.

Shares of AMD closed at $5.62 yesterday.

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