Advanced Micro Devices (NASDAQ:AMD) Screens as High-Growth Momentum Stock with Bullish Technical Setup

Advanced Micro Devices (NASDAQ:AMD) has been identified by a screening method created to find stocks displaying good technical condition, high growth momentum, and actionable setup patterns. This method uses three specific ChartMill ratings: a Technical Rating above 7 to verify a strong uptrend, a Setup Rating above 7 to find consolidation patterns ready for a possible breakout, and a High Growth Momentum Rating above 4 to confirm the company has improving earnings and sales fundamentals. This multi-layered screen seeks to find companies that are not only growing quickly but are also in a good technical state for purchase.

High Growth Momentum Fundamentals

The High Growth Momentum Rating combines different parts of a company's growth path, including earnings acceleration, growing profit margins, and positive analyst revisions. For investors focused on growth, these elements are important as they frequently come before continued upward movement in a stock's price. AMD's rating of 6 shows a good base of growth, supported by several important metrics:

• Earnings and Sales Growth: The company shows good year-over-year growth, with TTM EPS rising by about 24% and TTM revenue increasing by almost 32%. The most recent quarter displayed a large sales increase of more than 35% compared to the same quarter last year.
• Profit Margin Expansion: A main sign of operational efficiency, AMD's profit margin has shown a clear upward movement in recent quarters, growing from 6.29% three quarters ago to 13.44% in the last reported quarter. This indicates the company is effectively turning more of its revenue into profit.
• Estimate Revisions and Surprises: Analyst confidence is shown in an almost 3% upward change to next year's revenue estimates over the last three months. Also, AMD has exceeded revenue estimates in all of the last four quarters, with an average beat of 2.83%.

These parts are important to the high growth momentum plan, as they show a company that is not only growing but doing so in a quickening and profitable way, often getting the notice of institutional investors.

Technical Strength and Setup Quality

Beyond fundamental growth, the technical view is very important for timing a purchase. According to the detailed technical report, AMD has a perfect Technical Rating of 10, showing outstanding technical condition. This score comes from a mix of strong trends, relative strength, and moving average alignments.

• Trend and Performance: Both the long-term and short-term trends for AMD are classified as positive. The stock has performed much better than the wider market, ranking better than 94% of all stocks over the past year with a gain of more than 80%.
• Industry Leadership: Inside the competitive Semiconductors & Semiconductor Equipment industry, AMD performs better than 81% of its 112 peers, confirming its position as a sector leader.
• Consolidation Setup: With a Setup Rating of 7, AMD is currently showing a decent setup pattern. The stock has been trading in a consolidation range between about $224 and $267 over the past month. This time of sideways movement after a good advance lets the stock form a base of support, possibly preparing for its next move higher. The report also notes recent interest from large players and a pocket pivot signal, both of which add positive confirmation to the setup.

The mix of a top-level technical rating and a constructive setup pattern gives a good chart structure for momentum investors searching for a purchase point in a leading stock.

A Cohesive Investment Thesis

The screening method that found AMD is effective because it matches strong fundamental growth with a technically good chart pattern. The company's good High Growth Momentum Rating of 6 confirms the underlying business is performing well with notable sales growth, growing margins, and positive analyst sentiment. At the same time, the perfect Technical Rating of 10 and a Setup Rating of 7 indicate the stock is in a clear uptrend and is currently resting in a consolidation, providing a possible purchase point for investors who might have missed the first rise.

For investors looking for other opportunities that meet this strict standard of high growth, strong technicals, and quality setups, more results can be found by running the High Growth Momentum Breakout Setups screen.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. The author has no position in AMD. All investment decisions carry risk, and you should conduct your own research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results.