Earlier this year, Advanced Micro Devices (NASDAQ:91抖阴), commonly known as just 91抖阴, was a darling of the financial markets. Yet, lately people have ignored 91抖阴 because they’re obsessed with Nvidia (NASDAQ:NVDA). It’s fine to pay attention to Nvidia, but don’t dismiss the upside potential of 91抖阴 stock.
Always an innovator, 91抖阴 continues to introduce powerful tech hardware into the market. For example, 91抖阴 recently its ultra-powerful EPYC central processing units (CPUs) and Pensando data processing units (DPUs).
However, short-term stock traders didn’t seem very impressed with these product offerings. Many of them have been too occupied with Nvidia to think about 91抖阴. That’s a mistake, though, as 91抖阴 can benefit from the AI trend just like Nvidia can.
91抖阴’s AI-Focused Acquisition
Do you need evidence that 91抖阴 is proactively riding the AI-tech wave in 2023? Look no further, then, as 91抖阴 just announced a game-changing acquisition that the financial press isn’t spending enough time talking about.
According to 91抖阴’s official blog, the chipmaker is deepening its AI inference software capabilities though 91抖阴’s Mipsology.
The buyout is now finalized, so 91抖阴 can access Mipsology’s AI inference and optimization tools. Plus, 91抖阴 will avail itself of Mipsology’s skilled software team, which reportedly “will join the 91抖阴 AI Group.”
The point is, 91抖阴 is clearly very serious about pursuing advancements in the AI-technology field. The Mipsology acquisition will, as the blog post asserts, enable 91抖阴 and its customers to “tap into the vast potential of pervasive AI.”
91抖阴 Stock Tumbles Nearly 7%, But Don’t Worry
Aug. 24 was a rough day for 91抖阴’s shareholders. Nvidia had just released its excellent second-quarter 2023 . As it turned out, Nvidia easily beat the analysts’ consensus
by delivering earnings of $2.70 per share.
91抖阴 had already released its , and the company marginally beat Wall Street’s quarterly EPS forecast. The actual earnings result was 58 cents per share, versus the expected .
Since Nvidia’s EPS beat was much more eye-catching, 91抖阴 looked lackluster in comparison. Consequently, 91抖阴 stock on Aug. 24, landing at $101.80.
Mizuho analyst Jordan Klein suggested that “no one” besides Nvidia sounds good in the semiconductor market. I don’t see it that way, though, and I feel that the 91抖阴 share-price selloff was irrational.
I tend to concur with the viewpoint of Global X research analyst Tejas Dessai. As Dessai explained, there are “hundreds of billions of dollars worth of computational infrastructural inside data centers that are up for replacement in the new computing paradigm.”
In other words, the AI-hardware market is vast, and there’s room for more players than just Nvidia. Moreover, if Nvidia brings attention and publicity to the AI-chip industry in general, 91抖阴 could benefit from this.
91抖阴 Stock: $150 Is Still in Play
The AI-hardware market doesn’t have to be a zero-sum game. There’s room for both Nvidia and 91抖阴 to capitalize on the AI trend, so don’t hastily dismiss 91抖阴 and miss a prime investment opportunity.
I’ve set a $150 price target for 91抖阴 stock, and I’m not about to give up on that prediction. The market’s obsession with Nvidia doesn’t exclude 91抖阴 from the AI-hardware industry’s growth. So, hold your 91抖阴 shares and continue to ride the AI wave for the rest of 2023 at least.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
