Analyst Targets 11-Year Highs for Advanced Micro Devices Stock

Short-term AMD options traders are more put-heavy than usual

Managing Editor
Jun 1, 2018 at 10:05 AM
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Chipmaker Advanced Micro Devices, Inc. (NASDAQ:AMD) is trading higher this morning, after the stock received a price-target hike at Stifel. While the brokerage firm maintained its "buy" rating, it hiked the equity's price target to $17 from $14 -- territory not charted since early 2007 -- saying the company's "broader PC CPU offering will allow AMD to outperform the market." In response, Advanced Micro Devices stock is up 2.3% at $14.05.

This upside is just more of the same for AMD, which has surged more than 55% from its early April lows near $9. However, the semiconductor stock is now facing off against the $14 mark, which is home to its September and January highs. Looking ahead, Advanced Micro Devices has been one of the most volatile stocks in the summer months in the last 10 years.

Another short-term swing to the downside would certainly please short sellers. Although short interest on AMD fell almost 10% during the past two reporting periods, it still accounts for 21% of the equity's total available float, or four times Advanced Micro Devices stock's average daily trading volume.

Echoing this skepticism, AMD's Schaeffer's put/call open interest ratio (SOIR) of 1.08 ranks higher than 83% of all comparable readings taken in the past year. In other words, options traders are more put-heavy than usual among contracts set to expire in three months or less.

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