$AMD deep dive: -17% in a day then +37% in four sessions. I think it's a buy, add at $485-$505
$AMD fell 17% on Nov 5 in the post-midterm chip selloff and has rallied 37% in the four sessions since. On Monday Oppenheimer upgraded it to Outperform with a $600 target. On Tuesday Anthropic's IPO filing showed @AMD buying $2.5B of its stock as part of a supply deal for up to 2 gigawatts of AMD GPUs. I think it's a buy.
The business: Q3 revenue was a record $13.4B (+45%) with data center at $8.5B (+97%). The Q4 guide is about $17B which is 66% growth. Lisa Su expects revenue to grow more than 80% in 2027.
What you pay: about 120x trailing earnings against 22x for Nvidia and 44x for Broadcom. On 2027 consensus EPS of about $16.94 it is closer to 33x. The balance sheet has $15.8B in cash and investments against $7.1B of debt.
The risks: free cash flow was only $554M last quarter (4% of revenue) as inventory rose to $11.5B. Gross margin is guided down to 55% and PC and gaming sales should fall more than 20% this quarter. Several winners of the Nov 3 elections campaigned on slowing data center construction.
Chart: $188 in March to $658.52 in October and then an A B C correction to $402.10 that retraced 54.5% of the run. It is back above the 20 and 50 day with RSI at 54. My Elliott read is that the move off $402 is wave 1 of a new advance and a wave 2 pullback into $485 to $505 would be normal.
My plan: buy half here and add at $485 to $505. A close under $402.10 makes it a sell. A Q4 below guidance or a Helios delay makes it a hold. A close above $658.52 confirms a new leg higher.
Not financial advice.
Two frames from the $AMD deep dive: the crash and rebound since Nov 5 and my Elliott Wave levels for @AMD (wave 2 buy zone $485 to $505, invalidation on a close under $402.10, breakout above $658.52).
Sources: AMD Q3 2026 results and Q4 outlook (Nov 3 2026) · AMD Q3 2026 earnings slides (SEC 8-K exhibit) · Reuters: AMD guides Q4 ~$17B, sees 2027 revenue up 80%+ (Nov 3) · CNBC: Anthropic IPO range, $26B placement incl. AMD (Nov 10) · Dataconomy: AMD commits $2.5B to Anthropic placement (Nov 11) · GuruFocus: Oppenheimer upgrade, $600 PT, shares +13.26% Nov 9
Not financial advice. For informational and educational purposes only.
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