Advanced Micro Devices’ Data Solutions Portfolio Gets a Boost

Advanced Micro Devices, Inc. (NASDAQ: AMD) expanded its portfolio with the completion of its pending acquisition of Pensando Systems. The deal, worth $1.9 billion, was signed in April 2022.

AMD stock rose 6.6% to close at $98.75 on Thursday.

Pensando is now part of Advanced Micro’s Data Center Solutions group. This takeover expands the group’s product offering with the addition of its platform linked to distributed services (including software stack and data processing unit).

Advanced Micro President and CEO Dr. Lisa Su said the data center “remains one of the biggest growth opportunities for AMD.” He added that the buyout will help “provide cloud, enterprise and edge customers with a broader portfolio of cutting-edge compute engines that can be optimized for their specific workloads.”

Meanwhile, Pensando Chairman John Chambers said, “Pensando’s leadership position in software-defined cloud, compute, networking, security and storage services in framework of the much larger AMD portfolio is, in my view, perfectly suited to shape the data center computing landscape for the next decade.

Analysts opinion

Four days ago, Bank of America’s Vivek Arya maintained a buy rating on AMC with a price target of $160 (62.03% upside potential).

Additionally, 10 days ago, Piper Sandler’s Harsh Kumar upgraded AMD’s rating to Buy from Hold while raising the price target to $140 (41.77% upside potential) from 98. $. Kumar is of the opinion that “the main activities of the company are working very well”.

Overall, the Street is cautiously optimistic about the $160.7 billion semiconductor company and has a Moderate Buy consensus rating based on 13 buys and nine takes. AMD’s average price target of $134.47 suggests upside potential of 36.17% from current levels. Over the past year, AMD shares have risen 25.92%.

Reviews of bloggers

According to TipRanks, financial bloggers are 90% bullish on AMD, compared to an industry average of 67%.

Conclusion

Despite short-term cash and margin pressures, the Pensando takeover should boost growth opportunities for Advanced Micro Devices.

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