$美国超微公司(AMD)$ Here's why I think $AMD is quite cheap at $158.
$NVDA's price to sales ratio is 31.24 and $AMD's is 7.51.
For income statements that are not in a phase of maturity, the price to sales ratio is a measure of enthusiam.
The above spread is bound to close going forward and I believe the P/S ratios of the companies will eventually come to parity.
In absolute terms, I believe both companies have a long way to go as the world demands exponentially more computation over the coming decade/s.
But in terms of valuation, the market is currently valuing Nvidia as the sole provider of AI chips when in fact:
1. $AMD is a strong contender to a number 2 position, as a provider of AI chips.
2. It is very likely that $AMD's hardware can actually outperform $NVDA's.
$NVDA has a very strong software and networking moat, which will make it hard for $AMD to fully displace $NVDA .
But I believe that AMD will take a considerable % of marketshare, for the following reasons:
1. Companies will want to have a reliable second source for AI chips.
2. $AMD's chips will be cheaper and eventually, higher performing.
For this reason, I believe the market will soon assign more enthusiastic multiples to $AMD, especially as datacenter growth kicks in, in the coming quarters. This is likely to lift $AMD's valuation over the coming few years.
Comments