Advanced Micro Devices, Inc. (AMD) Fair Value & PE Analysis
Semiconductors · NASDAQ
Current Price
$578.44
PE Ratio (TTM)
142.2x
Intrinsic Value
$330.15
-75.2% margin of safety
What Is Advanced Micro Devices, Inc.'s Fair Value?
As of 2026-10-28, applying a 50.0x earnings multiple to Advanced Micro Devices, Inc.'s (AMD) earnings per share of $3.94 yields a fair value estimate of $330.15 per share, versus a market price of $578.44.
Fair value from earnings multiples is sensitive to the multiple you choose. Across the sensitivity grid the estimate spans $287.49 to $377.6. This is a relative estimate anchored to earnings, not a statement of fact. For a cash flow based view, see the intrinsic value estimate on the DCF page.
How the PE model works · Recalculate in PE mode · AMD intrinsic value (DCF view)
Is Advanced Micro Devices, Inc. (AMD) Overvalued?
At $578.44, AMD trades above its PE-based fair value estimate, meaning the market pays a premium over the applied earnings multiple. By this model the stock looks expensive unless earnings grow into the price.
COMPETITIVE MOAT
↑Data Center & AI GPU Dominance
AMD's high-performance GPUs are critical for data centers and AI workloads. This positions them strongly in a rapidly growing and essential market segment.
↑Strategic Partnerships & Ecosystem
Collaborations with companies like nVent for cooling solutions and Fermi for credit support build a robust ecosystem. This integration enhances their platform's appeal and utility.
↑Broad Product Portfolio
AMD offers a diverse range of processors and accelerators, catering to various computing needs. This breadth allows them to capture market share across different segments.
INVESTMENT RISKS
↓Technological Obsolescence Risk
The semiconductor industry evolves rapidly. Failure to innovate quickly enough could render AMD's current offerings outdated, impacting future sales.
↓Supply Chain Vulnerabilities
Global supply chain disruptions or geopolitical tensions can impact the production and availability of critical components. This can lead to production delays and increased costs.
↓Macroeconomic Headwinds
Broader economic downturns or shifts in tech spending can reduce demand for AMD's high-performance computing products. This impacts revenue and profitability.
Base case
AMD base case PE valuation
Intrinsic Value
$330.15
Margin of safety
-75.2%
Expected annual return
-10.6%
Base case assumptions: 20.0% annual earnings growth, 50x target PE, 10% discount rate, 5 year projection. Data as of 2026-10-28.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the AMD PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Advanced Micro Devices, Inc. respond.
Open PE Calculator for AMDCompany Overview
Advanced Micro Devices, Inc. (AMD), established in 1969 and headquartered in Santa Clara, California, operates as a global leader in the semiconductor industry. The company organizes its extensive operations into two primary segments: Computing and Graphics, and Enterprise, Embedded and Semi-Custom. In its Computing and Graphics division, AMD develops a range of products including x86 microprocessors (often as accelerated processing units), chipsets, and various graphics processing units (GPUs), encompassing discrete, integrated, data center, and professional variants, alongside providing development services. The Enterprise, Embedded and Semi-Custom segment focuses on server and embedded processors, bespoke System-on-Chip (SoC) products, and foundational technology for popular game consoles, also offering associated development support. AMD's diverse product lineup features processors for desktop and notebook personal computers under well-known brands such as AMD Ryzen, Ryzen PRO, Ryzen Threadripper, Threadripper PRO, AMD Athlon, Athlon PRO, AMD FX, AMD A-Series, and PRO A-Series. Discrete GPUs for these PCs are offered through the AMD Radeon graphics and AMD Embedded Radeon graphics brands, while professional graphics solutions include AMD Radeon Pro and AMD FirePro. Furthermore, the company provides high-performance accelerators for servers, including Radeon Instinct, Radeon PRO V-series, and AMD Instinct, along with AMD EPYC microprocessors designed for server environments. Its embedded processor solutions span multiple brands, such as AMD Athlon, AMD Geode, AMD Ryzen, AMD EPYC, AMD R-Series, and G-Series. AMD also produces chipsets under its own trademark and crafts customer-specific solutions leveraging its CPU, GPU, and multimedia expertise, including specialized semi-custom SoC products. AMD reaches its wide array of clients, which comprise original equipment manufacturers (OEMs), public cloud service providers, original design manufacturers (ODMs), system integrators, independent distributors, online retailers, and add-in-board manufacturers. The company's sales and distribution network includes its direct sales force, independent distributors, and dedicated sales representatives.
Financial Metrics — AMD PE Stock Valuation Data
PE Ratio (TTM)
142.2x
PEG Ratio
1.15
Earnings Yield
0.68%
ROE (TTM)
10.1%
Revenue/Share (TTM)
$25.32
Debt/Equity
0.06x
Frequently Asked Questions
What is the PE ratio of AMD?
The trailing twelve-month PE ratio of AMD reflects how much investors pay per dollar of Advanced Micro Devices, Inc.'s earnings. This metric is most useful when compared to Semiconductors peers and the company's own historical range.
Is AMD overvalued based on PE ratio?
AMD's PE of 142.2x combined with a PEG ratio of 1.15 provides a growth-adjusted perspective. A PEG near 1.0 means the P/E is roughly in line with the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Semiconductors, a DCF analysis may be more appropriate.
How do I value AMD stock using PE ratio?
To value Advanced Micro Devices, Inc. using PE: (1) Compare the current PE (142.2x) against the Semiconductors median to assess relative pricing, (2) check the PEG ratio (1.15) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of AMD?
AMD's PEG ratio is 1.15, calculated by dividing the PE ratio (142.2x) by the expected earnings growth rate. A PEG near 1.0 means the P/E is roughly in line with the expected earnings growth rate. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for AMD stock valuation?
PE ratio gives a quick relative read — how AMD is priced versus Semiconductors peers. DCF provides an absolute value based on projected free cash flows. For the most reliable valuation, use PE as a quick comparability screen and DCF for a deeper fundamental analysis. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See AMD DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Technology valuationsP/E and DCF value AMD with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-10-28. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.