Dan Loeb Takes Passive Stake In AMD, Stock Jumps

Having frequently asked when billionaire activist investor Dan Loeb would revisit the melting ice cube that is Intel, where his hedge fund Third Point revealed an activist stake in 2020 and pushed the company to explore “strategic alternatives” only to quietly unwind the position in 2021 when the stock soared before subsequently crashing…

When is @DanielSLoeb1 going activist on intel again?

— zerohedge (@zerohedge) August 23, 2022

… moments ago we got the answer when CNBC’s Scott Wapner reported that Loeb is turning his attention not to Intel, which just slashed its dividend by 66%, and which some have speculated is too far gone for even a brilliant activist to save as the following chart of its projected revenue shows…

… but to its biggest competitor AMD.

According to CNBC, the hedge fund manager took the bet when AMD shares struggled: AMD shares have underperformed the rest of the sector over the last 12 months, down more than 30% as the Philadelphia Semiconductor Index declined 14%.”

However, unlike Intel which continues to plumb new lows, AMD has bounced back this year by 21% as China opened up its economy and the overall stock market has rebounded. The chipmaker recently reported fourth quarter earnings that exceeded Wall Street expectations for sales and profit, but guided analysts to a 10% decline in year-over-year sales in the current quarter.

The news has predictably sent AMD stock surging.