AMD price targets: why so much difference? (beginner's question)

Discussion in 'Stocks' started by andread, Apr 14, 2006.

  1. andread


    I was looking at AMD, and I was impressed by the price target summary on Yahoo. The low target is 10, the high target is 65. That's more than 6:1 ratio. I can understand there is some uncertainty about AMD, but this looks really a lot to me.
    How can professional people value a stock and get so different results? Am I missing something?
    Any explanation appreciated. Thanks
  2. MTE


    Valuations are based on assumptions, hence the target depends on assumptions.
  3. gg12



    get more information to build your own opinion/assumption.

    Attached there is my take on the current situation of PALM.
    Currently above 34 it's a buy, below it's a sell.

  4. andread


    Thank you for the answers.
    I understand that to estimate a stock's price you have to make some assumptions (for example about the future cashflows). I also understand that there are different techniques, and maybe some people might have different information than others (although, in the case of professional analysts, I'm not sure it's true).
    Still, looking at the current situation (price around 32), it means that someone thinks AMD should double, and someone thinks AMD should go down 2/3. That's quite a difference!
    The reason why I'm asking is that I have been looking sometimes at valuations for other stocks, and they tend to be pretty close to each other, at the point that I was thinking about going deeper into this subject. My idea is now changing.
  5. diff analysts have separate agendas
  6. ===========
    Helpful question and some more reading ,
    & wisdom is profitable to direct.

    Same reason apple trees & tulips vary in price over time ;
    same reason AMD has sold for less than $00.45,
    & more than $45.00.[all the data]:cool:
  7. Do your own research, build your own opinions and trade. Be objective.
  8. hajimow


    Do your own research, build your own opinions and trade. Be objective

    Perfect saying. Just listen to what others say but decide yourself. Analysts sell their opinion to the big investors. So don't trust them at all. I wish I were a big analyst and I could say like in 2010, AAPL would be $300 or $5 and push the stock up and down by $2 and retire in a day.
  9. andread


    Interesting answers. I think I'll spend some more time on it.
    Thank you
  10. My experience with AMD is limited to 2 recent portables. I am quite satisfied with these.

    I must admit that the AMD 'story' about their Sempron and Turion (overlapping) versions was utterly confusing. In fact they further even complicated the mess with 2 different major power/performance categories. When buying a portable, the information about the CPU often requires some first class detective work. :D

    Mind boggling. Serious performance benchmarks to be found nowhere, only vaporous articles by sycophants obviously paid by the manufacturer.

    PS: I haven't bought any more recent CPU, AMD or other.
    #10     Apr 16, 2006