Despite continued dominance in the server space, Bernstein said sliding computer and new parts demand has made Advanced Micro Devices hard to be excited about. Analyst Stacy Rasgon downgraded the semiconductor stock to market perform from outperform. He also cut the price target by $15 to $80, implying a more modest 4.5% upside from where the stock closed Monday. The downgrade comes as demand for personal computers has fallen over recent months.
Rasgon said AMD's new client parts have been available at deeper discounts in less time than the prior generation because Intel 's "semidestructive behavior" resulted in an oversaturated parts market. He said AMD has potential for some risk to growth margins beyond what was expected to come as a result of broader market worries because of the sliding demand paired with rising costs.