Yahoo Finance Why AMD (AMD) Shares Are Plunging Today
What Happened:
Shares of computer processor maker AMD (NASDAQ:AMD) fell 7.7% in the afternoon session after Bloomberg reported that the Biden Administration is planning to implement tighter trade restrictions if semiconductor companies continue granting China access to technologies made in the United States. The report follows ongoing trade tensions between both countries, which might raise uncertainty about market dynamics in the semiconductor segment heading into the new earnings season.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy AMD? Access our full analysis report here, it's free.
What is the market telling us:
AMD's shares are very volatile and over the last year have had 18 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago, when the stock gained 5.6% on the news that the company announced an agreement to acquire Silo AI, an AI lab in Europe, in an all-cash deal valued at approximately $665 million. Silo AI builds solutions that help customers easily add AI to their products, services, and operations. Silo has been used to build and train multilingual LLMs, some powered by AMD Instinct MI250X GPUs. The announcement signals AMD's commitment towards improving its AI capabilities to gain more market share and deliver better solutions to its customers.
AMD is up 16.9% since the beginning of the year, but at $161.99 per share it is still trading 23.4% below its 52-week high of $211.38 from March 2024. Investors who bought $1,000 worth of AMD's shares 5 years ago would now be looking at an investment worth $4,820.
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