Advanced Micro Devices Inc.’s stock plunged 14% in active premarket trade Tuesday, after the semiconductor maker lowered its sales outlook late Monday because of a weaker-than-expected PC market. The stock is currently on track to open at the lowest level Nov. 30, 2012. UBS analyst Stephen Chin reiterated his sell rating, while cutting his stock price target to $2 from $2.20. “We are not surprised with this negative preannouncement given the pervasive data pointing to universal weakness in PC demand, particularly for a company like AMD, which derives roughly 70% of its sales from PCs,” Chin wrote in a note to clients. Wedbush’s Betsy Van Hees also said the warning wasn’t a surprise, but cut her stock price target to $2.25 from $2.50. Meanwhile, Northland Capital’s Gus Richard said he believes the second quarter was the bottom of the PC inventory cycle, as he’s seen some evidence of builds picking up in the current quarter. “We reiterated our outperform [on AMD] and would accumulate the shares on weakness,” Richard wrote.
Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.
From:: Stock Market News