Advanced Micro Devices, Inc. (NASDAQ:AMD) has reportedly inked a three-year partnership with Mentor Graphics (NASDAQ:MENT) , which will enable it to offer more choices to embedded developers in the x86 architecture high-performance computing segment.
Per the announcement, customers will be able to download Mentor Embedded Sourcery CodeBench Lite and Mentor Embedded Linux Lite for free to design new solutions and applications.
The partnership will enable developers to access useful Linux tools so as to build new applications in the fields of industrial, healthcare, casino gaming and more.
We note that, in 2014, the two companies had founded an embedded software ecosystem complete with open-source tools to build, analyze, debug and optimize embedded software.
What this Means for AMD?
With more and more devices become interconnected, Moore’s Law is getting validated time and again. Moreover, microprocessors at the core of the devices are becoming even smaller in size, better at performance and last but not the least easy on the pocket.
As per an IDC report, worldwide intelligent systems revenues are expected to reach over $2.2 trillion in 2020 that is currently growing at a CAGR of 7.2%. Given the immense scope the sector offers, Advanced Micro’s efforts to further strengthen its position in the burgeoning embedded market looks aptly timed and promise growth in the coming years.
Stock Performance Overview
We note that shares of AMD have outperformed the broader Zacks Elec-Semiconductors industry on a year-to-date basis. While the stock has returned a phenomenal 202.4%, the broader sector has returned only 38.8%.
The upside momentum in the stock was primarily driven by the introduction of several new Accelerated Processing Units (APUs) and Graphichs Processing Units (GPUs). Additionally, upcoming new products like Zen will drive top-line growth in the long run.
Moreover, partnerships with the likes of Alibaba (NYSE:BABA) will boost its competitive prowess. We also note that Radeon technology continues to gain traction, which is positive for the company's top-line growth.
Zacks Rank and Stock to Consider
At present, Advanced Micro carries a Zacks Rank #2 (Buy).
Some better-ranked stocks in the broader technology space are Applied Optoelectronics, Inc. (NASDAQ:AAOI) and Cirrus Logic, Inc. (NASDAQ:CRUS) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Notably, the consensus estimate for Applied Optoelectronics’ current year has improved to 81 cents from 51 cents over the last 30 days.
Similarly, the consensus estimate for Cirrus Logic’s current year has improved to $3.73 from $ 2.89 over the last 60 days.
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MENTOR GRAPHICS (MENT): Free Stock Analysis Report
ADV MICRO DEV (AMD): Free Stock Analysis Report
CIRRUS LOGIC (CRUS): Free Stock Analysis Report
APPLIED OPTOELE (AAOI): Free Stock Analysis Report
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