Why I went All-in on AMD before earnings

February 1, 7:55 am

Yesterday, before AMD reported its earnings, I delved into its alternative data and found several positive indicators. With these insights in mind, I made a large investment in AMD shares and am pleased to announce that the stock has risen by over 10% today.

However, before we delve into the alternative data points for AMD, let's take a look at its earnings.

The American chipmaker's earnings per share came in at $0.69, exceeding the expected $0.67 per share. The sales for the quarter rose by 15.9% YoY, reaching $5.6 billion, surpassing the anticipated $5.52 billion. For Q1 2023, the company forecasts revenue between $5 billion and $5.6 billion, which is on par with the expected $5.51 billion estimated by analysts.

AMD's data center business revenue increased by 42% in the quarter, compared to the 33% decline recorded at Intel's data center and artificial intelligence unit. AMD's faster and smaller chips have allowed it to gain an edge over Intel, with J.P. Morgan estimating a 5-7% gain in the server market this year, bringing its market share to between 28% and 30%. Although AMD's sales in its PC chip unit did decline by 51% in the quarter, it is expected to bottom out in Q1 and then grow in Q2 and the second half.

Considering these solid fundamentals, let's examine some alternative data.

AMD's website has been attracting more visitors, with a nearly 50% increase since last summer, which could indicate strong interest and demand for its products.

The company has adopted a responsible approach to hiring and reduced its open positions by 75% since last summer. However, it seems that the company is starting to ramp up its hiring again, as job postings have been trending up over the past month. Despite having fewer employees than Nvidia and Intel, the company has more open positions than its two main competitors.

I also believe that a strong CEO can build a strong company, and according to employee reviews, Lisa Su is one of the strongest CEOs with an approval rating of 97 out of 100. Impressive!

Let's continue with employee ratings. AMD also has one of the most positive business outlooks among its employees, with a score of 87 out of 100. This can be compared to Intel, where the general business outlook among its employees is 67 out of 100.

Other noteworthy alternative data points include more Reddit subscribers than Nvidia and Intel, high 70s to low 80s sentiment for the stock across multiple stock forums, and continued growth in followers across Twitter, Instagram, and YouTube.

Using alternative data in your investment strategies can provide a more comprehensive view of the market, help you identify trends and opportunities, and allow you to spot opportunities before others. At Dillibits, we believe that alternative data will ultimately lead to better investment decisions and improved performance. If you have any questions, please don't hesitate to contact us.

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