AMD's "Double Black Diamond Ski Run:" Do Earnings Show Steeper Rally Ahead?

expected, with AMD now projecting revenue growt of at least 80% next year. For more, let's bring in our pantor, Bartowski manpartner over at Chatwood Investments, and Christopher Davis, partner at Hudson Value Partners. Appreciate you both being with us today. To take a closer look at AMD. Interestingly enough, I just highlighted some of numbers there, Ed, I mean, really impressive numbers. They had a few misses, but they weren't necessarily inrics that were as important as perhaps those data centernumberm But we've given back a lot of the gains. We're onlyabout a third of a percent now. When I'm looking at the big board, and the markets themselves are uptty significantly. So why the pullback on the digestion of these numbers? I absolutely no idea why there's is selling at a Peg ratio ofany 0.28. That means its growth in its earnings per share is 109%. And it's selling at a forward p e of 30. This stock should be bought all day long. And nobody second look at it. In terms of negativity. This is a very ve coI absolutely love it. I think it should be bought all long. And Christopher, how are you looking at this one? I mean, do you have a any rational reason behind why we've seen it I mean, there seem to be a lot of optimism overnight about the positive outlook, the reaction to it. The Q3 numberslves were y really well received. Yeah, I think our our view on it is we're not necessarily as anunabt may be. I think the risks to AMD in the future are a lot more balanced. They are a strong number two player to Nvidia, but their biggest customers are the data centers. That's where their growth is right now. And as we look at what the now policy environment and policy dynamics are going to be, I think it could be a lot less friendly to new data center development, particularly if we look at what's going on in Texas, where we're supposed to have 50% of new data center development. The new policy makers, there might be a lot lessdly to the permitting process, which could slow down demand for AMD's chips and data center components in general. Now, I think one thing about that that could slow down demand, but it also could bring supply and demand much more in balance and remove or alleviate some of the fears we have out there aboutI e to get your thoughts on what Christopher said there, because he brought up a good point here about data center being so importanto these numbers. I mean, they forecasted more than 80% revenue growth just for next Data center accounting. They view for more than 80% of that total revenue. Is there now a risk in place here at post midterms that we may see awdown that potentially affects the guidance for that infrastructure story? Yeah. Well you know you never know what's going to happen in politics. I happen to live in the state of Texas. And the issue that I hear most of the ens that they don't want the data center in their county, but they're still going forward with a lot of the data centers. So I'm sure if that's going to, you know, be, you know, ed ig new data centers. But they do drive a lot of their future revenue from data centers. So he does bring up a good point that I hadn't thought about, but that's not going to slow me down because the company knows where their revenue is coming from. And a lot of these contracts have been signed, so they just haven't brought the revenue in yet. But again, I'm I'm extremely bullish on AMD and Christopher. We've had a lot of guests with great analogies on the show today, f some reason, just happens to be a great day of analogies. And you've got one he AMD. You call it a double black diamond ski run for investors, becauseo much of the valuation depends on the continued growth. How much of that execution do you view as already being priced into the stock. And what sort of deceleration would have to happen to trigger a meaningful correction here for AMD? Yeah, it's it's it could be really tough sledding when we dour calculations of decomposing enterprise value, where we breakut what the current earnings power value is, the asset value, and then look to hee the growth expectations that are baked into the price. Over 80% of AMD's value right now is growth. So if there's any sort of wob in that, you're going to see that market implied value of growth, which in the Peg ratio and is also in the in the p e ratio, which is which is high, that's going to that's going to wobble and that's going to come down. And when you look at where the number one player Nvidia trades or the market trades or some of the semi stocks in general, AMD is at a premium to that. So I think you have to at least give your base case. And your downside ris at least what if AMD goes back to Nvidia's multiple orarket multiple. All right. I'm looking at you've giv a $642 price target here for AMD. That's a 30 plus percent upside from where we're currentlyding right now. What has to go right for us to get there? Basically just hit on everything that they forecasted. Their earnings are going to come from the data centers. And I don't believe thatitics are going to get in the way of data center build out. I believe the free enterprise system is going to work, and we're going to see continued growth. And that's basically it just kind of lly ple as it's laid out and have everything come true as they've laid it out. And let's not forget, you know, the companies have a responsibility to report things according to the S you know, filings that they have to be accurate. So I don't be AMD would come out and throw out, you know, these robust earnings groh projections if they didn't have valid reasons to support tha All right. Well AMD not lifting all of the semi names, but it is certainly getting a lift up a percent right now for AMD. Really appreciate you both breaking down the numbers with us and