Is Advanced Micro Devices, Inc. (AMD) A Good Feminist Stock To Buy?

We recently compiled a list of the 11 Best Feminist Stocks To Invest In. In this article, we are going to take a look at where Advanced Micro Devices, Inc. (NASDAQ:AMD) stands against the other feminist stocks.

With the passage of time, the role of women in the modern day workplace has slowly started to grow. In less than a century, more women not only lead companies but are also among some of the wealthiest individuals in the world. At the same time, women have demonstrated that they are equal to men when it comes to disrupting industries. One of the best examples of this phenomena is America’s best known rocket company SpaceX. While SpaceX is famous for its founder and billionaire Elon Musk, the firm’s chief operations officer and president Gwynne Shotwell has been equally responsible for its massive success in the rocket industry which has dislodged decades of monopolies held by a few defense contractors.

In fact, this rising trend of women leading the charge at some of the biggest companies in the world has also generated interesting statistics when it comes to compensation. Data from Equilar shows that in 2023, out of the 341 CEOs part of the study, 25 were women. Their median pay package stood at $17.6 million, which according to Equilar, was 7.7% higher than the figure for the complete data set. At the same time, the 25 female CEOs saw five new executives added to the list when compared to 2022.

Considering this, it would appear that the gender pay gap in the US appears to be narrowing. To confirm this, we’ll have to look at the pay statistics for the entire country as opposed to only S&P 500 CEOs. Well, on this front, data gathered by Pew shows that there’s a lot to be done. The research firm points out that in 2002, women earned 80% of what men were paid. Two decades later, i.e. in 2022, this stood at 82%, indicating that there’s a lot more to be done to decrease the wage gap between the two genders. However, at the same time, younger women might be changing these trends. This is because according to Pew, women aged between 25 and 34 earned 92% of their male counterparts, which is quite higher than the figure of 86% in 2002.

With these details in mind, we decided to take a look at the best feminist stocks to invest in.

Our Methodology

To make our list of the best feminist stocks to invest in, we ranked publicly traded Fortune 500 companies with female CEOs by the number of hedge funds that had bought the shares in Q1 2024. Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

A close up of a complex looking PCB board with several integrated semiconductor parts.

Advanced Micro Devices, Inc. (NASDAQ:AMD)

Number of Hedge Fund Shareholders In Q1 2024: 124

CEO: Dr. Lisa T. Su Ph.D.

Advanced Micro Devices, Inc. (NASDAQ:AMD)’s CEO Dr. Lisa Su is widely heralded as one of the most successful executives in the semiconductor industry. Under her leadership, AMD has transformed itself from a loss making entity to a profitable company that competes with Intel on the back of product design and cost advantages. Like Intel, Advanced Micro Devices, Inc. (NASDAQ:AMD) is also targeting the AI industry with a diversified product portfolio. Susquehanna is also quite optimistic for Advanced Micro Devices, Inc. (NASDAQ:AMD), as it raised the firm’s share price target to $200 from $185 in June 2024 and kept a Positive rating on the shares. The firm shared that Advanced Micro Devices, Inc. (NASDAQ:AMD) has gained market share in the PC and data center markets, and that it can continue to benefit from Intel’s manufacturing woes.

A classic growth stock, Advanced Micro Devices, Inc. (NASDAQ:AMD)’s forward price to earnings ratio of 46.73 is more than twice the market’s 21. This implies that investors continue to expect it to outpace the market in growth. Meridian Funds mentioned Advanced Micro Devices, Inc. (NASDAQ:AMD) in its Q4 2023 investor letter and shared:

Advanced Micro Devices, Inc. is a global semiconductor chip maker specializing in central processing units (CPUs), which are considered the core component of most computing devices, and graphics processing units (GPUs), which accelerate operations running on CPUs. We invested in 2018 when it was a mid-cap value stock plagued by many years of underperformance due to lagging technology and lost market hishare versus competitors Intel and Nvidia. Our research identified that changes and investments made by current management under CEO Lisa Su had, over several years, finally resulted in compelling technology that positioned AMD as a stronger competitor to Nvidia and that its latest products were superior to Intel’s. We invested on the the belief that AMD’s valuation at that that time did not reflect the potential for its technology leadership to generate significant market share gains and improved profits. This thesis has been playing out for several years. During the quarter, AMD unveiled more details about its upcoming GPU products for the AI market. The stock reacted positively to expectations that AMD’s GPU servers will be a viable alternative to Nvidia. Although we pared back our exposure to AMD into strength as part of our risk-management practice, we maintained a position in the stock. We believe AMD will continue to gain share in large and growing markets and is reasonably valued relative to the potential for significantly higher earnings.

Overall AMD ranks 1st on our list of the best feminist stocks to buy. You can visit 11 Best Feminist Stocks To Invest In to see the other feminist stocks that are on hedge funds' radar. While we acknowledge the potential of AMD as an AI play, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than AMD but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

 

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Disclosure: None. This article is originally published at Insider Monkey.