Advanced Micro Devices Inc. (NASDAQ:AMD) stock traded higher Wednesday in premarket trading as technology stocks gained ground. Nasdaq futures rose 0.55%, while S&P 500 futures gained 0.46%.
AMD shares have posted strong gains over the past year. However, the stock remains below key short-term moving averages.
Large-cap technology stocks benefited from a firmer risk tone ahead of Wednesday’s opening bell. Investors are also watching whether AMD can regain key moving averages after its recent pullback.
Technical Analysis
AMD trades 0.7% below its 20-day simple moving average of $491.36. It is also 4.4% below its 50-day SMA of $510.42. That signals a mixed near-term trend.
However, the longer-term picture remains bullish. AMD trades 12.3% above its 100-day SMA of $434.57 and 49.4% above its 200-day SMA of $326.67.
The relative strength index stands at 47.78. The neutral reading suggests neither buyers nor sellers have firm control.
The 20-day SMA remains below the 50-day SMA, which is a bearish short-term signal. However, the 50-day SMA remains above the 200-day SMA, supporting the longer-term bullish trend.
AMD set a swing high in June before falling to a swing low in July. The July break below support has made it harder for recent rallies to gain momentum.
Resistance sits near $530, while $463 represents a key support area. A move above the $510-$530 range could strengthen the bullish case.
Analyst Outlook
The stock trades at a price-to-earnings ratio of about 123.6 times, reflecting a premium valuation. It carries a Buy consensus rating with an average price forecast of $591.39.
Argus Research maintained a Buy rating on Aug. 6 and raised its price forecast to $625. Rosenblatt maintained a Buy rating and raised its price forecast to $700 the same day. JPMorgan maintained a Neutral rating on Aug. 5 and raised its price forecast to $550.
Benzinga Edge Rankings
AMD scores strongly on several Benzinga Edge measures.
Its Momentum score stands at 97.93, while Quality is 94.17 and Growth is 94.84. However, its Value score is just 4.55.
The combination points to strong growth and momentum but a rich valuation. Investors will be watching whether AMD can deliver enough growth to support that premium.
Top ETF Exposure
AMD has an 8.10% weighting in the iShares Semiconductor ETF (NASDAQ:SOXX). It also accounts for 7.74% of the CoreValues America First Technology ETF (NYSE:USMD) and 6.87% of the ARK Autonomous Technology & Robotics ETF (BATS:ARKQ).
Its sizable weighting means fund flows into or out of these ETFs can influence demand for AMD shares.
Price Action
AMD shares were up 0.64% at $487.50 in Wednesday premarket trading, according to Benzinga Pro.
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