AMD (AMD) last night lowered its 2019 revenue outlook to mid-single-digit growth and raised gross margin outlook by 100 basis points to 42%, Jefferies analyst Mark Lipacis tells investors in a post-earnings research note.
The analyst, however, thinks the guidance is conservative "given AMD has been executing and hitting its product cycle stride when Intel (INTC) is mis-executing."
His sensitivity analysis suggests earnings power of $1.47 - $2.57 from AMD's x86 business. He reiterates a Buy rating on AMD and boosted his price target for the shares to $40 from $34.
The company's share gain and gross margin expansion story is intact, Lipacis contends. The stock in premarket trading is down 4% to $32.54.
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