Advanced Micro Devices (AMD) Is Up 15.5% Ahead of Next Week’s Earnings Report

On Tuesday after the market closes, chip maker Advanced Micro Devices, Inc (NYSE: AMD) is scheduled to report earnings and shares are already up 15.5% since the start of the year. However, it should be mentioned that shares also had good run ups ahead of previous earnings reports – only to sink when those earnings reports did not live up to expectations. Incidentally, we have had AMD in our SmallCap Network Elite Opportunity (SCN EO) portfolio since last summer and we are also up 15.50% since that time. With that and next week's earnings report in mind, here is the latest news about AMD:

Kaveri is Launched as AMD and Intel Move in Different Directions. On Tuesday, Advanced Micro Devices officially began shipping its Kaveri chip architecture (meant for games and other high-performance applications) with the company pricing both the new 3.7GHz A10-7850K and the 3.4GHz A10-7700K for less than $200—$173 and $153, respectively; plus a third, lower-power variant, the 3.1GHz and 3.3GHz A8-7600, will ship later in the first quarter for about $119. PCWorld noted that these prices are roughly equal to the Core i5 chips that Intel Corporation (NASDAQ: INTC) released in the second quarter of 2013. In addition, VentureBeat has pointed out that the new chips show that AMD is moving in a very different direction from Intel, who last week's Consumer Electronics Show in Las Vegas put a lot of emphasis on "perceptual computing," or using gestures and other new kinds of interfaces to control computers. Instead of interfaces, AMD is focusing on powerful graphics capabilities. Bullish Options Trading. On Tuesday, AVAFIN reported trading of Advanced Micro Devices options resulted in a new 90-day call volume record. Specifically, a total of 11,011 put and 73,089 call contracts was traded for a 0.15 put/call ratio on shares of AMD while Wednesday saw triple the normal share trading volume as investors and traders alike no doubt jockey for position ahead of earnings. Cramer Would Rather Own Intel. For what his opinion is worth, Jim Cramer, the host of CNBC's Mad Money, stated in a recent Lightening Round: "They has a history of missing their quarters. I'd rather sell this stock and buy Intel." For the record though, it was not long ago that Cramer was touting the stock. Another Trial Lawyer Circles. Early last week, Holzer & Holzer, LLC, a so-called "Shareholder rights" law firm, issued a press release to say that they are "investigating" whether Advanced Micro Devices and/or certain of its officers complied with the federal securities laws when making statements to investors between October 27, 2011 and October 18, 2012. And now this week, Robbins Geller Rudman & Dowd LLP has announced that a class action has been commenced in the United States District Court for the Northern District of California on behalf of purchasers of common stock during that period. Obviously if AMD has a good earnings report, more trial lawyer vultures might look elsewhere for easier pickings but a poor earnings report could have more circling. Share Performance. On Wednesday, Advanced Micro Devices rose 3.65% to $4.47 plus shares are up 15.5% since the start of the year, up 67.4% over the past year and up 66.2% over the past five years:

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Finally, here is the latest technical chart for AMD where the drop offs after the last two earnings reports is rather noticeable:

With the recent news in mind, will Advanced Micro Devices strike out again for the third earnings report in a row? Stay tuned.

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