Advanced Micro Devices and x86 CPU market

Rosenblatt analyst Hans Mosesmann is out with a research note on Advanced Micro Devices, Inc. (NASDAQ:AMD), providing his perspective on the x86 CPU market, and AMD’s market-share gain. The analyst rates AMD a Buy with a price target of $20.00, which represents a potential upside of 39% from where the stock is currently trading.

Mosesmann wrote, “AMD in the 2000-2011 timeframe enjoyed mid-to high teens x86 CPU market share (low teens dollar share), peaking in 2006 at ~25% unit share (high-teens dollar share). Since 2011 the company has had dismal share at mid-single digit unit share (low single digit dollar share). Of late AMD has had basically no share in the server market […] For us the issue in this AMD vs. Intel x86 battle is not that AMD can capture 10% of the market (perhaps what is starting to be seen in current share price move), or not even mid-to-high teens share which history suggests is a given when AMD reappears onto the x86 scene.”

“The issue for us is why won’t AMD achieve more than the 25% share (18%-20% dollar share) seen in 2006 when AMD had merely integrated a memory controller function onto the CPU, which was a rather simple move that merely caught Intel off guard for a few quarters. An 18%-20% dollar share in a market that is say $45 billion (server, notebook, and desktop), is ~$9 billion that is a great opportunity for AMD to say the least,” the analyst continued.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Hans Mosesmann has a yearly average return of 11.1% and a 59.5% success rate. Mosesmann has a 19% average return when recommending AMD, and is ranked #410 out of 4583 analysts.

Out of the 21 analysts polled in the past 3 months, 8 rate Advanced Micro Devices stock a Buy, 10 rate the stock a Hold and 3 recommend to Sell. With a downside potential of 10%, the stock’s consensus target price stands at $12.87.

Amazon “Prime Air” Drives Significant Traffic Bump 

Earlier this year, Amazon.com, Inc. (NASDAQ:AMZN) announced new centralized air hub at the Cincinnati/Northern Kentucky Airport (CVG). The company utilized the new hub to support continued fast growth in the core Retail segment, and in particular, to help expand the selection and availability of Prime-eligible items.

According to recent data from the CVG, YTD air freight traffic, as measured by deplaned tons has increased 175% Y/Y to 2,078 tons, and was up 683% Y/Y in May to 1,268 tons, driven by Amazon Prime Air.

Baird analyst Colin Sebastian believes the ramp of Amazon’s Prime Air operation is the driving force behind the increase, as Amazon continues to invest heavily in the facility’s cargo/sortation infrastructure. The analyst views Amazon’s ability to rapidly scale its air cargo investment as an indicator of the company’s logistical sophistication, and should widen the competitive moat relative to other sub-scale retailers that rely on third-party carriers.

Sebastian reiterates an Outperform rating on shares of Amazon, with a price target of $1,100, which implies an upside of 10% from current levels.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, Sebastian is a top analyst holding a yearly average return of 24% and a 79% success rate. Sebastian has a 38.6% average return when recommending AMZN, and is ranked #12 out of 4583 analysts.

Out of the 32 analysts polled in the past 12 months, 29 rate Amazon stock a Buy, while 3 rate the stock a Hold. With a return potential of 12%, the stock’s consensus target price stands at $1,122.27