- AMD
- NVDA
Sometimes the best investing advice is also the shortest. A caller phoned into a popular financial show asking a question thousands of investors have probably typed into a search bar at some point this year. The answer came back almost instantly, with no hedging attached.
Jim Cramer has spent years hedging his stock calls with caveats, disclosures and careful qualifiers designed to keep him out of regulatory trouble. This time, when it came to one of the market’s most talked-about chipmakers, he barely bothered with any of it.
Jim Cramer says to buy AMD
A caller asked during the September 11 episode of Mad Money whether Advanced Micro Devices was worth buying given how closely the stock tends to track Nvidia’s moves. Cramer’s answer left little room for interpretation.
He first explained why he had not personally acted on the stock sooner. “In my conference call yesterday with the club, I admitted that AMD and Dell, I was confounded by my restrictions,” Cramer said, referring to trading rules tied to his Charitable Trust. “Every time I was talking about it on TV, we’re probably going to buy AMD, and we’re probably going to buy Dell; those are the two best stocks in this market,”he added.
Cramer did not stop at frustration over missed timing. He praised both the company and its leadership directly, saying, “AMD is a fantastic stock, fantastic company, and Lisa Su is great.” His closing line summed up the entire segment. “Buy it, end of story,”Cramer said, a verdict about as unambiguous as television stock picking gets.
AMD’s data center business is driving growth
The enthusiasm is not coming out of nowhere. AMD’s second-quarter results showed data center revenue climbing 107% year over year to $6.7 billion, representing roughly 58% of total company revenue, while overall revenue rose 50% to $11.5 billion,TheStreet reported.
Profitability improved just as sharply as the top line. Non-GAAP operating income reached $3.1 billion and non-GAAP diluted earnings per share rose to $1.66. AMD guided for third-quarter revenue of approximately $13 billion, plus or minus $300 million.
The company is not just selling more chips. It is trying to sell entire systems built around them. At the September 11 Goldman Sachs Communacopia and Technology Conference, AMD executive Dan McNamara said the company was “transitioning now to full rack scale,” describing AMD as becoming more of a software and systems company moving beyond its traditional role as a silicon supplier. A shift built around its Helios rack-scale platform,Yahoo Finance reported.
