- Piper Sandler analyst Harsh Kumar downgraded Advanced Micro Devices Inc (NASDAQ:AMD) to Neutral from Overweight with a price target of $130, down from $140.
- The analyst is cautious on the broader automotive sector, saying the pace of orders and strong pricing "may come into question" as supply normalizes in the second half of 2022.
- The price target implies that the stock is fair-priced.
- Related Content: Here's Why Cowen Sees Notable Upside In AMD
- Once supply and demand hit parity, it will likely result in a slower pace of orders than the pace seen over the last few years, Kumar notes.
- His downgrade of AMD reflects concerns about a slowdown in the PC market during 2022, the "earnings and growth headwind" from closing the Xilinx Inc (NASDAQ:XLNX) deal, and the "broader market dynamics around high-multiple, high-growth technology stocks."
- As such, he feels there is more downside risk than upside risk at this point.
- Price Action: AMD shares traded lower by 1.52% at $126.32 in the premarket session on the last check Thursday.
