Highly Regarded

Is Advanced Micro Devices Inc. (AMD) Stock Undervalued or Overvalued?

Trailing-twelve-month multiples vs Technology sector peers in our coverage

130% Premium TTM fundamentals · sector averages from covered peers

AMD trades at 177.7× TTM earnings — a 130% premium to its Technology sector average of 77.4× in our coverage.

The Numbers

P/E (TTM)

177.7×

Sector avg: 77.4×

P/S (TTM)

22.2×

Sector avg: 20.4×

Market Cap

$767.84B

EPS (TTM): $2.65

Revenue (TTM)

$34.64B

Net income: $4.33B

Technology Peer Comparison

How AMD's multiples stack up against sector peers we cover. Click any peer for its own valuation breakdown.

Stock Price P/E (TTM)
AMD This page $470.95 177.7×
NVDA $220.92 54.7×
AAPL $316.83 40.1×
MSFT $507.14 31.7×
AVGO $370.45 77.7×
INTC $89.54 —
PLTR $186.32 433.3×
CSCO $110.47 42.7×
ORCL $149.14 34.5×
CRM $257.65 37.4×
TXN $260.82 47.9×
QCOM $170.46 34.4×
ADBE $292.76 17.5×

Is the Premium Justified?

August 30, 2026

Advanced Micro Devices' P/E of 175.7x, significantly exceeding the sector average of 85.4x, is largely justified by its exceptional growth prospects in the AI and data center markets. Q2 2026 results demonstrated a 50% year-over-year revenue increase, with data center revenue more than doubling due to strong demand for EPYC CPUs and Instinct GPUs. The company's robust AI product roadmap, including rack-scale platforms and new AI chips, positions it for continued market share gains. Analysts are bullish, anticipating AMD to surpass Intel in server CPU revenue by 2027 and project significant expansion in AI semiconductor revenue, underpinning this premium valuation.

Sources

Frequently Asked Questions

Is AMD overvalued or undervalued?
On trailing-twelve-month earnings, AMD trades at 177.7x versus a Technology sector average of 77.4x in our coverage — a 129.5% premium. Whether that's justified depends on growth, margins, and risk; see the context above.
What does the P/E ratio tell you?
Price-to-earnings compares a company's share price with its per-share profits. A higher multiple means investors pay more per dollar of earnings — often for faster expected growth — while a lower one can signal slower growth or higher perceived risk.
Why compare against the sector average?
Valuation multiples vary structurally between industries — software typically trades richer than banks or energy. Comparing AMD with its own Technology peers is more informative than comparing against the whole market.
Is a cheap stock automatically a good buy?
No. A discount can be justified by weak growth or elevated risk (a "value trap"), and a premium can be earned by quality and consistency. Valuation is one input — pair it with the fundamentals and the AI context on this page.

Methodology

Multiples are computed from trailing-twelve-month fundamentals (from company filings) and the latest share price: P/E is price ÷ diluted EPS, and P/S is market cap ÷ revenue. Sector averages use the Technology names in our 50-stock coverage with positive earnings — a deliberately like-for-like, if imperfect, benchmark.

Stocks with negative trailing earnings are compared on price-to-sales instead. Multiples update with prices and fundamentals; AI context refreshes weekly.

Not Financial Advice

This page is for education and information only. Indicators are mechanical calculations, AI commentary can contain errors, and nothing here is a recommendation to buy or sell any security. Do your own research and consider consulting a qualified financial advisor. See our full disclaimer.

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