The Clash of Tech Titans: AMD Faces Uphill Battle Against Qualcomm

The competition intensifies between Advanced Micro Devices Inc. AMD and Qualcomm Inc. QCOM as both tech firms prepare to unveil their earnings reports.

AMD: A Chip Giant Under Pressure

This past year has been challenging for AMD, with its stock plummeting 33.12%. It has also seen a decline of 3.40% since the start of 2023. Analysts predict that AMD will report fourth-quarter earnings of $1.08 per share with revenues projected at $7.53 billion, yet the stock continues to struggle in a bearish trend.

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From a technical standpoint, AMD’s stock is showing several sell signals, trading below the eight-day, 20-day, 50-day, and 200-day simple moving averages. The Moving Average Convergence Divergence (MACD) indicates a reading of negative 2.86, while a Relative Strength Index (RSI) of 43.50 suggests the stock is moving toward oversold conditions.

Nonetheless, there is a glimmer of hope. Recent ratings from Rosenblatt, Susquehanna, and Melius Research have set an average price target of $181.33 for AMD, signaling a potential upside of 57.42%.

Qualcomm: Riding the 5G and AI Wave

In contrast, Qualcomm has been enjoying a prosperous year, with its stock rising 19.73% and increasing 12.24% year-to-date. The company is next set to disclose first-quarter earnings, with analysts forecasting earnings of $2.96 per share and $10.92 billion in revenue.

Unlike AMD, Qualcomm’s technical indicators appear strong.

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Qualcomm’s stock trades above its eight-day, 20-day, and 50-day moving averages, indicating bullish strength, although it remains below its 200-day moving average. The MACD is at 3.57, denoting positive momentum, and an RSI of 62.99 suggests further upward potential before reaching overbought conditions.

Analyst expectations for Qualcomm are less aggressive than those for AMD, with Barclays, Mizuho, and Melius Research establishing an average price target of $193.33, indicating a potential 12.75% upside.

The Verdict: Will AMD or Qualcomm Dominate?

In terms of technical performance, Qualcomm currently has the advantage, showcasing strong momentum and higher year-to-date returns. AMD, however, is experiencing a significant downturn but presents a compelling upside opportunity if it can recover.

Investors may view AMD as an enticing option given its potential rebound, yet Qualcomm stands as the more stable choice heading into earnings announcements.

As both companies prepare to reveal their earnings soon, the focus will be on AMD’s capability to recover or on Qualcomm’s potential to expand its lead in the semiconductor sector.

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