Buffett Brain · Research note
Score updated 23 Oct 2026 · analysis from 5 Oct 2026
AMD· Technology
AMD
AMD's valuation is stretched with a P/E of 184, while its profitability metrics lag sector leaders.
Buffett fit
Weak fit
Owner
26
Durability
76
Management
86
Price
0
Score updated 23 Oct 2026 · analysis from 5 Oct 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Technology stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
Owning AMD would mean navigating a highly competitive landscape with significant R&D demands.
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AMD's durability is supported by positive profitability over the last five years and a robust financial health score of 100.
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AMD's management has maintained a low debt/equity ratio of 0.06 and a net debt/EBITDA of -0.23, showing conservative financial stewardship.
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With an earnings yield of 0.54% and an yield of 0.84%, AMD's valuation is highly stretched.
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- The 5-year price target and the return it implies
- What would change the call
- Graham, Lynch and Greenblatt on the same stock
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1Revenue CAGR of 13.64% over 5 years indicates strong growth.
- 2EPS CAGR of 46.65% suggests significant earnings improvement.
- 3Interest coverage ratio of 32.6 shows strong ability to meet interest obligations.
- 4Net debt/EBITDA of -0.23 indicates a net cash position.
Concerns
5- 1 of 184 suggests significant overvaluation relative to earnings.
- 2 of 5.18% is below the sector's top-quintile cutoff of 13.4%.
- 3 of 49.5% lags the sector's top-quintile cutoff of 60.6%.
- 4 of 10.7% is below the sector's top-quintile cutoff of 18.0%.
Price history
$508+322.5%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Advanced Micro Devices, Inc. operates in semiconductors, focusing on data centers, client and gaming, and embedded segments. Its revenue of $34.64 billion is derived from AI accelerators, microprocessors, and GPUs. The of 49.5% is below the sector's top-quintile cutoff of 60.6%. Unit economics are pressured by high competition and capital intensity.
How this analysis has moved
The call has held across 5 reviews.
Sep 27, 2026 → Oct 23, 2026
What other investors would say
The same company, judged by three other documented playbooks.
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