Bored so I want to make a case for going long on AMD.

This stock has rallied 20% the past 2 days after a devastating 26% drop 2 months prior. Company market cap is at 11 billion. Their main competitors being Intel and Nvidia which are at market cap of 162 billion/94 billion respectively.

My case, AMD in the long run at least till 2020 will be a multibagger stock. There are a lot bears out there for this stock due to their past mistakes and not so stellar balance sheet...not to mention the company is currently unprofitable.
I also feel some of these analysts doesn't understand the technology and AMD's master plan.

So here's my case for AMD

1. Infinity Fabric, the AMD pioneered technology that can glue CPU and GPU together with low latency is a game changer to Moore's law.

  • AMD cannot compete with Intel in the R&D department and cannot afford to introduce year after year, huge CPU dies with extra cores to compete which are extremely expensive with every SKU. AMD instead spent the last few years developing the infinity fabric, which allows them to glue multiple CPU cores and GPU cores together with almost perfect scaling. This means they can use their desktop low end processors and just glue them together with no extra R&D to make high core count server grade processors for peanuts. They can afford to be extremely competitive with pricing and performance thanks to this tech.

  • Their GPU sales will always be behind Nvidia even if they introduce something ridiculously awesome. So to pour massive amounts of R&D to compete, they again will use infinity fabric to double their GPU performance as die shrinks year after year.