SAN FRANCISCOA Wall Street analyst Monday (July 20) upgraded his rating on Advanced Micro Devices Inc., saying he expects the company to report strong second quarter results and third quarter guidance Tuesday.
Craig Berger, an analyst with FBR Capital Markets, wrote in a research note that distributor checks suggest Asian distributors had a stronger-than-expected June quarter and are more positive about third quarter shipment prospects.
Recent checks for AMD and the PC supply chain have also strengthened, Berger wrote. In a separate research note issued last week, Berger said recent PC build checks with the world's top notebook ODMs and desktop motherboard makers show that second quarter PC builds grew 7 percent sequentially and are expected to grow another 13 percent in the third quarter.
Recent checks also show that AMD's second quarter production increased by 78 percent compared to the first quarter and is expected to grow another 1 percent in the third quarter, Berger said.
Last week's strong second quarter results and third quarter revenue guidance from archrival Intel Corp. also bode well for AMD, Berger said.
Berger upgraded AMD to "outperform" from "market perform" and maintained FBR's share price target of $5.25 for the company. AMD's stock traded at $4.12 in afternoon trading Monday.