Advanced Micro Devices, Inc. (NYSE:AMD)

CAPS Rating: 3 out of 5

The Company is a global semiconductor company with facilities around the world. It provides processing solutions for the computing, graphics and consumer electronics markets.


Player Avatar TheStankometer (< 20) Submitted: 1/24/2011 5:59:31 PM : Underperform Start Price: $8.41 AMD Score: +129.64

After just a quick whiff through the Smelloscope it was easy smell that AMD would likely have a rough 2011. Take a look at these stinky stats:

-Bad debt to equity ratio with concerning 5 year trend
-Very low book value per share with a troubling 5 year trend
-Bad price to free cash flow ratio
-Gross margin is very low compared to it's peers
-Very odd 10 year trends on ROE%, ROA%, and net profit margin
-Negative insider trading

The bottom line:

I'd like to take a moment to give AMD's former CEO a round of applause. Way to go buddy!! You drove your former company into the ground and as your punishment they paid you 12 million dollars to quit. (It's not like they needed that money to help fix your mistakes...)

If only my bosses could similarly understand the value of failure. Paying me millions to quit would clearly be a very smart business decision. But they just don't get it.

Ok. I know I'm being ridiculous... and I'm sure that I'm over simplifying a very complicated situation. But regardless... something smells very fishy over at Advanced Micro Devices. And my nostrils want no part of it.

On 1-5-11 at a price of 8.91 AMD scored only 35 out of 100 points on the Smelloscope rating system. This ranks within the bottom 10% of stocks I've scored.

Thumbs down.

(official nose of the Stankometer)

Full Discloser:
I don't own a long or short position in AMD but I do own one of their competitors: Intel (INTC)

TheSmelloscope is a value rating system created to evaluate stocks for fun. It is operated by a novice investor named djshagggyd. NOVICE being the key word. Do not follow the Stankometer's advice without conducting your own research.

Report this Post 2 Replies
Member Avatar pjgz (46.78) Submitted: 7/13/2012 12:53:31 PM
Recs: 1

Hi Stankometer,

What's your measurement on AMD now? Metrics look bad, but they are severely undervalued anyways, a steal at this price. I though I called the bottom on a falling knife at $6/sh. Just don't think it will go lower, too much good R&D and product launches.

Member Avatar OklaBoston (68.12) Submitted: 7/18/2012 1:05:18 PM
Recs: 0

The CEO bought 8000 shares at an avg. price of $6.2 last month. That's a strong sign it's time to end this "Underperform" pick.

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