$AMD · The Motley Fool · 2026-11-05

So everything has been we don't have enough supply. So Nvidia wins, Broadcom wins, Micron wins, AMD wins, Intel even wins.

if we go to the scenario where okay Nvidia dominates but then suddenly we have Nvidia that still dominates but we have a lot of other companies that come out with their own chips TPUs you have AMD etc etc then they should have also been rewarded

So that that money is just getting on top of an AMD, which an AMD said they're going to grow at least 80% next year. I don't think that number changed over the last couple of hours.

Would you buy Micron and AMD on days like today? The memory names, they can remain cheap. And I've made this this statement before. They can remain cheap for quite a while and then suddenly become expensive because the growth rates are slowing down, margin slows down, etc., etc. But if let's say only Micron and AMD dropped over the past month and everything else stayed flat, then I would say yeah probably yes.

But since all the others, a Meta, a Google, I mean, Sofi did go up a little bit or since the earnings, but a Nebus or or even an Nvidia or whatever or Axon also recovered a bit.

But if all of these names have also come down and these names don't offer the same headaches as as an AMD or or a Micron, then I would go I would go with them. I still own AMD.

I still own Micron and actually AMD today is yes it's getting cheaper and cheaper because the stock keeps dropping while the company keeps accelerating. So maybe at one point that will that name will become okay if we stay at 400 the company continues to accelerate from here.

Maybe the other names go up faster and that's why their profile gets a little bit less attractive. Then I could pivot back to adding to my AMD position. So it's currently on hold.

I own it. I like what they're doing. They're growing. They're accelerating. So, I'm happy. But when I look at adding, especially in today's environment, it's it's changing cuz maybe two weeks ago a name was trading at I don't know higher multiples and today it's trading at way attractive multiples because the market did bring the stock down more more and more.

But yeah, I'm trending towards just going for for a meta Google these these types of big companies going into 27.

Yeah, I mean I guess I generally agree. Alphabet's the only company I own in that kind of space. Uh generally if you look at AMD, you know, enterprise value to sales is 15. Sure, they've got a phenomenal growth rate.

That's still a lot to pay for a stock, especially if we do go through some sort of slowdown in the AI spending cycle. You know, going from an 80% growth rate to a 20% growth rate means you don't deserve a 15 price enterprise value to sales multiple. deserve a three enterprise value to sales multiple.

So that's that's one of the challenges I think for a company like that.

Um, same thing with AMD. I just don't see the great valuation. You know, I've I've written about that with this AI trade in general, and somebody put this uh in the comments just a bit ago that we're in the third inning of this sell-off.

Um, I tend to think that's right. You typically go through this Gartner hype cycle where everything's hyped. Oh my gosh, the future is going to be so different. Blah blah blah blah blah.

And then you go through a crash and you go through what's called the trough of disillusionment. That's when you get the headlines that like, oh, AI, see AI was complete BS like this was never going to be anything.

That's when I want to be the buyer and I want to buy the companies that you know the companies that hopefully end up turn turning into Amazon and Alphabet and Meta companies like I know Meta was started in 2004 but the companies like that and I don't think we're anywhere near that point.

We're we're nowhere near that capitulation point with the market where you know like AMD trading for 15 times sales is is not that capitulation. We talked yesterday I think you know in 2015 they were trading for what point4 times sales.

No, different story because they were they were on the brink of of not making it. But that's that's where I want to be an aggressive buyer. Not not because we have one one bad day or one bad week.

You know, we've had a few bad weeks, but um but I don't think we're anywhere near, you know, some sort of trough of disillusionment. I've been through I've been through these things. They last a lot longer than you think.

But I mean to AMD's point and the micron's point to AMD's point if we look at what's expected for next year. So next year based on their own growth rates we're looking at around 90 95 billion in revenue.

So the sales multiple on a forward basis at today's prices gets basically slashed in half because they're if the stock stays of course flat for for a foreseeable future then the the multiple just comes down by 50% purely because the company is just growing that quickly