ฝัง
- เผยแพร่เมื่อ 16 ต.ค. 2024
- AMD stock vs NVIDIA stock - it's a comparison we first did nearly seven years ago after identifying NVIDIA as perhaps the best artificial intelligence stock at the time. Today, investors are probably interested in how these two companies compare because they're hoping AMD stock takes off at the same trajectory as NVDA stock. You might be surprised to know that both companies have performed quite well over the past eight years. Today, their respective valuations aren't that far off, though NVDA stock is more rich. That's no surprise because they're growing faster and have better cash flows. AMD is clearly playing catchup, and analysts hope their new MI300 chip will - at a minimum - allow them to capture the breadcrumbs NVIDIA leaves behind. The bear case for AMD is that their software platform just can't keep up with NVIDIA's CUDA platform. This video is chock full of information including NVIDIA's foray into Enterprise AI which all investors in AI stocks will want to watch.
RESEARCH PIECES USED IN THIS VIDEO:
1. NVIDIA’s Growth is Stalling: Why We’re Not Worried
www.nanalyze.c...
2. Xilinx - Investing in FPGAs For AI Hardware
www.nanalyze.c...
3. Investing in GPUs for AI - AMD GPUs vs NVIDIA GPUs
www.nanalyze.c...
4. The Artificial Intelligence Stock That Rocked Wall Street
www.nanalyze.c...
CHAPTERS:
Intro
00:26 When we first wrote about NVIDIA
00:50 AMD vs NVDA back then
02:27 How to measure AI revenues
03:10 NVIDIA's crazy growth vs AMD
04:22 AMD's challenge to NVIDIA
06:48 NVIDIA's biggest advantage
08:50 NVIDIA and Enterprise AI
10:15 AMD vs NVDA: Profitability
11:43 Performance numbers are in
12:46 Valuing NVIDIA vs AMD
14:13 Parting thoughts
Conclusion
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AMD is a clear buy to me. They really surprised the last 5 years and I believe they will continue to do so.
While they haven't surprised much with their data center segment in the past several years, their revenue growth has really been strong over the past four. Would be interesting to dig in and see why that is. Do you know by chance what the key drivers were for that revenue growth if it wasn't data center?
@@Nanalyze First of: They had to fight real hard to regain a position in the market. They deserved so much more sales from a technological point of view. They were heavily hold back by intels sales contacts and people who just bought intel because it worked the last 10 previous years. Also theire globalfoundries connection didn’t do them good. On tsmc they put in the next gear.
To your question: they are so deversivied these days that you can’t just pick one key driver.
New xbox and PlayStations released? Chips by AMD!
GPU for gaming had a bad gen? CPU was a homerun!
Consumer market stagnated? They bought Xilinx! (Huge deal in the next years btw!)
And with MI300X/A they really picked the fight in the AI market.
I could go on like this…
Excuse my English tho :d
Hey no problem. Thank you for taking the time to spell that out. So all revenues segments seem to be firing properly. And yes, good point on Xilinx. We didn't cover that M&A event but it was a notable acquisition as we've covered Xilinx before as well. Perhaps a follow-up piece might be in order to look at the other segments AMD dabbles in aside from just data center and gaming (the obvious ones to compare NVIDIA too).
@@Nanalyze Sure :), btw: if you cover them again, please also cover the one thing they always lacked compared to nvidia: software from amd.
AMD just released ROCm 6 (think about ROCm like its CUDA).. which was a huge deal for developers.
Btw: I myself am a dev and only bought into stocks because in 2017 i thought of amd as heavily undervalued.
@@Nanalyze only becausae xilinx
AMDs AI chip is not only faster and cheaper but also uses open source, which will be such a great advantage, that even Nvidia is changing to open source. Way to go AMD 🎉
As always, the ground truth is in revenue growth for the "data center" revenue segment. It will be very clear to see if this chip is in demand during the first year it's being sold. Nvidia's CUDA has a massive ecosystem so AMD will need to start realizing similar adoption and rapidly.
@@NanalyzeI agree but being a small investor I look for the potential and advantage a company has over the competition. If I wait to see the revenue, then I will be too late to the party
No FOMO around here ;)
And yet, they can't sell it. As Jenson said" if the competition was giving their chips away they would still buy his chips, and he is backing up those words. 1K stock price while amd can'y get out of its own way.
this is by far the most insightful YT channel on investing! I'm so glad I found this
Those are some very kind words, thank you! We're glad you found us too. 🫶
Love your videos for their focus on hardcore facts than on hope and hype.
Thank you for those kind words! Facts are what we present and the viewer can use them to supplement their own investment decisions.
Great video. What's your take on the potential SNPS ANSS M&A? Market definitely dont seem to like it 😅
Thank you! Good question. We never bother going down these paths until the M&A event is done and dusted. That's because we don't want to do a ton of research, then have the deal fall through. Should this merger finalize, then we'll likely cover it in an article.
"once it works nobody calls it AI anymore, companies just make it their own" haha man were you right about that one. Apple Intelligence confirms :)
To be fair a number of researchers have said that and we use the quote often without citation
Thanks for sharing Joe. AMD's 1100 P/E is scary!
An off topic question: is there an ETF or product investing based on your dividend growth thesis?
You're most welcome! Our own DGI strategy, Quantigence, hasn't been developed into an ETF yet, though we have a calculator and report for Premium subscribers. Another ETF that offers dividend growth which we've covered a lot is SCHD: th-cam.com/video/zaZWpr4hx0w/w-d-xo.html
Great content as usual. What do you guys at Nanalyze think about the Synopsis attempt to acquire Ansys? Both stocks moved accordingly lately. I have used Ansys professionally many years, so this is not just another merger. 80B cap compnay acquiring a 30B cap which is a market leader in engineering simulation. If done smoothly, we may be looking at a giant in the making for the coming years. I have been looking to open a position in Synopsis lately. I guess I ll need to follow on this a bit more.
We will cover this M&A event once it solidifies. Doing a bunch of research work and then having the deal fall through as happened before. ;)
Yet again a great in depth analysis, that good it's making me question my AMD holding and going 80/20 into Nvidia and Synopsis. Going to do more DD on the latter but the only thing making me question is Nvidia's current valuation. But I questioned it last year! 😂
Always tricky to try and figure out where NVIDIA is going. It's tempting - and totally understandable - to think these several quarters are an AI hype anomaly, which is why it's important to look at their plans beyond just selling chips during a boom. AMD is playing catch up, that's pretty obvious, and we'll have to see how they fare. If this demand boom continues, and the AMD new chip is any good, there's room for more than one winner. Company-specific risk for either company can be an issue. Synopsys we'd go long on if we weren't so heavy into NVIDIA at the moment. Thank you for the comment and kind words!
And AMD hasn't performed half bad at all. That's always worth noting. We just tend to try and think with a decade-long horizon on these things - at least.
I would've thought AMD would've closed the gap somewhat but that's not happening just yet or ever. I do know that they'll always be behind NVIDIA, I just thought they'd have much more room to grow. But as you say we'll have to see how their new chips will perform, also Lisa Su is a big factor for me she's a fantastic CEO. Again thank you for the analysis! Hopefully I'll be in the premium membership this year 👍
We LOVE to hear that! Our community keeps growing and there are a lot of great conversations we have with Premium members, an entire suite of products and services, and even more to come in 2024. The support we get makes this all possible. Thank you!
Thanks for the deep work.
You're most welcome
At this point, wouldn't TSMC be a safe bet. Does not matter if the hyperscalers or AMD, NVDA.. don't they all use TSMC?
Good point. We covered TSMC here: th-cam.com/video/8A0wuZAiN2Y/w-d-xo.html
Not much competition, both should continue to do well. Unless we get new chips from big tech or maybe chinese who now have extreme motivation after USA chips ban.
Great content as always. 👌
Agree. Thank you very much for the compliment!
Love your video's ! Helped me make informed decisions in 2023 , lets make 2024 even better !
That's great to hear! We always publish content with the goal of supplementing people's investment decisions, not telling them what to do. To hear we've helped someone become a better investor is the best compliment we can hope for. Here's to 2024 being another great year!
Great video
Really glad to hear that! We really liked how this turned out and appreciate the validation a lot. Thank you.
13:16 Using price to sales ratio is a bad metric for valuation for these types of companies. This doesn't take into consideration growth and the type of margin that Nvidia commands. Using this type of valuation metric, Walmart would have a "better" valuation than nearly all companies due to the shear volume of revenue dollars that move through the company, however we know the large majority of Walmart's revenues never make it to the bottom line. A better valuation metrics for these two tech companies would be the PEG ratio or price to forward free cash flow (annualized current free cash flow works too).
We use our simple valuation ratio (described here: th-cam.com/video/c_cMdOTMbD4/w-d-xo.html ) for disruptive tech stocks only. You are correct that other ratios are more suitable for dividend growth companies like Walmart, and that gross margins matter when considering valuations. We like to keep things very simple around here because we are simple people ;)
Hope you cover synopsis. ✌️
Ask and ye shall receive. Here's our latest piece on Synopsys: www.nanalyze.com/2023/05/cadence-stock-vs-synopsys-stock/
What you think on the future of intel
We have a piece that covers Intel. Incoming: th-cam.com/video/m5I0rUhGJis/w-d-xo.html
Same as before NOTHING
Sounds just like when people shit on AMD and said that they would never make it because Intel was so much better lol. I expect the same outcome here
No it doesn't actually. It a well-researched take on the data center efforts of both companies. What facts presented do you disagree with then?
When AMD first released its Epyc server chip everybody and their brother dumped all over them saying they would never compete with Intel.@@Nanalyze
I find your analysis incomplete - you DO NOT take into account the fact, that neither AMD nor NVIDIA posses peroduction capacities / own factories like intel and have to rely in production on third party - currently TSMC. You made no production analysis. And production is what matter now. Noone wants to wait a year to get a AI chip from Nvidia. There is a shortage of AI chips due to the limited COWOS capacity at TSMC or third party (Samsung, etc ...) to produce AI chips. The company, that secures the production capacity at TSMC will be able to satisfy the demand and grow rapidly - since AMD has more experince in chip packaging , amd maybe use some less advanced packaging and still make great AI chips. I wouldn't underestimate AMD's ability to get decent market share in AI. AMD has secured significant portion of COWOS capacity at TSMC. BTW Krzanich (former Intel CEO) said Intel must keep AMD server share under 15-20% because otherwise it will be a problem for Intel. And we know the current situation of intek in server market. Nvidia now might be in the same position as was intel 5-6 years ago. Never, never underestimate Lisa Su.@@Nanalyze
@@richardg3882 The video has time limits, so we couldn't cover everything under the sun. That's great that you want to steer the topic in another direction, but we're curious to hear your thoughts about what we presented. AMD is playing catchup here. You're right, production matters, so AMD needs to start producing - and SELLING - a lot of data center chips fast. Intel lost their edge, no doubt about that. As for people who praise CEOs, did you work with Lisa? We didn't, and we didn't work with Jensen either, so we're in no position to say if either of these individuals are being underestimated by the market.
And YOU clearly did ZERO research on intel to even think it's a play here, Intel has failed so badly, it is NOW forced to be moving into Fab, it is not even anywhere near mastering the weakest TSMC dusk much less master making chips,
Where have you been fir the pass decade of intel business and losses of business and lack there of,
You did not even realize it's the government funding their massive pivot. .
So intel could not even do this turn, themselves. .. to even suggest intel has a dog , much less and dog on this fight, IS how delusional you are, because you do not even know that Sony and TSMC are building a brand new massive bigger state of the ar Fab city in Japan to escape the Taiwan China conflict. ..
They ALREADY have the master techs, skills knowledge AND SUCCESSFUL EXPERIENCES that will literally just slide right into Japan new location..
Now think, NO ONE is buying intel stuff now or for anything meaningful and ou think you have a point on what track record???
I hope you guy loaded the boat on NVDA and made that nice 2000 percent gain.
:) Note that we don't load the boat on any stock because we're risk-averse investors. Instead, we allocate a fixed amount of money to each position in our portfolio and don't exceed that. Why? Because nobody can consistently find "the next NVIDIA" over decades and load the boat on it. There will be winners, and there will be losers. We have made a lot of realized money on NVIDIA having invested in it prior to the article mentioned in this video, but "a lot" is always relative. ;) It's still our largest position as well.
@@Nanalyze Understandable. I don't load the boat any more either. Learned that lesson the hard way when the tech bubble burst. Glad you made good money on NVDA. Always nice to have a big winner regardless of position size.
Ah, an OG investor from back in the day! The tech bubble bursting was nuts. Agree. Thank you for the comment!
Like Button = Smashed!
Thank you for the love!
❤
Glad you enjoyed the piece!
Video aged like LeBron
Half our audience lives outside the USA and we can't expect everyone to know who that is. Even if they do, "aged" comments aren't allowed here (positive or negative) because they add no value to the conversation. What about this 6-month old video do you agree or disagree with?
Nothing has changed. amd has nothing for Nvidia.
As Aunt Cathie would say, wait five years. ;)