It used to be said that Intel (NASDAQ: INTC) only let Advanced Micro Devices (NASDAQ: AMD) survive so to avert antitrust concerns. In fact, AMD almost folded in 2017, which would have eliminated the company for good. However, the company has turned around since then and may have taken the title from Intel as a top chip supplier.

But even if AMD has taken the lead, is it a great buy right now?

The chip industry has been notoriously cyclical since its inception. As customer demand rises and falls, it heavily affects the chipmakers. Because of that, you must be careful of valuation metrics because they can be misleading. Often, the companies are at their cheapest at the end of the cycle because investors anticipate falling earnings. They also can look expensive at the beginning of cycles for the exact opposite reason.

Continue reading

Source Fool.com