AMD: Strong Sentiment Points to Good Earnings

Includes: AMD, INTC
by: Jett Winter

AMD (NASDAQ:AMD) is scheduled to release Q2 earnings today, July 15th, after the market close. Average analyst estimates for the chip maker are $.06/share in EPS and $1.55 billion in revenue. Twenty-five analysts track the stock with one upward EPS revision in the last 30 days and one downward EPS revision in the last 30 days. Last quarter, AMD beat average analyst expectations by.13/share, .09/share vs. (.04)/share.

Now let’s look at the sentiment for AMD to see if we can learn anything ahead of their earnings release. We will use sentiment captured by Piqqem to determine AMD’s outlook for this quarter’s earnings. Piqqem uses a -100 to 100 scale and leverages the wisdom of crowds and its own proprietary algorithms to capture and calculate sentiment. Last quarter sentiment for AMD predicted a great quarter and the company delivered.


Previous AMD Sentiment Results

Any sentiment rating above 25 is considered positive, below 0 is considered negative, while 0-25 is considered neutral. Changes in sentiment are also crucial in understanding and interpreting a company’s sentiment ahead of an event like earnings. Finally, market forces need to be considered to make sure overall market sentiment changes are not overly influencing a stock’s individual sentiment.

AMD is also part of the Piqqem Technology Sentiment Index which tracks sentiment for 28 technology stocks in the Hardware & Networking, Software & Gaming, Internet & Mobile, and Semiconductor sectors. Sentiment for the semiconductor sector has shown growing strength recently, which is also positive for AMD.

Sentiment for AMD

Source: Piqqem

Can AMD deliver results as impressive as Intel (NASDAQ:INTC)?

The above chart shows AMD’s sentiment increasing by 7 pts from the beginning of the quarter thru today. As a comparison, sentiment for the Piqqem Technology Index rose 2 pts in the same period, which means AMD’s increase in sentiment was independent of market forces. On the Piqqem scale, AMD’s sentiment rating of 26.43 is considered positive and its absolute sentiment indicates a quality stock. Only AMD knows their actual results, but current sentiment points to the Chip maker delivering strong results on Thursday.

I will be posting earnings reports next week on IBM (NYSE:IBM), Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN), Yahoo! (YHOO), EMC (EMC), and Netflix (NASDAQ:NFLX) so check back to see these results and if you have an opinion you can vote at Piqqem.

Disclosure: No positions