7 Exercise Tips How to Stream 'Rabbit Hole' Roblox's AI Efforts 9 Household Items You're Not Cleaning Enough Better Sound on FaceTime Calls 'X-Ray Vision' for AR 9 Signs You Need Glasses When Your Tax Refund Will Arrive
Want CNET to notify you of price drops and the latest stories?
No, thank you

AMD upgraded as 'Fusion,' 16-core chip future looms

Advanced Micro Devices stock is upgraded Thursday by Broadpoint AmTech analyst Doug Freedman, citing a solid product road map and debt restructuring.

Advanced Micro Devices stock was upgraded Thursday by Broadpoint AmTech analyst Doug Freedman, citing a solid product road map and debt restructuring efforts.

AMD was trading above $7 midday on Thursday, high above the $3.50 (approximate) lows seen back in July of this year.

Freedman said in a research note Thursday that he is upgrading AMD to "buy" from "neutral" and raising the price target to $10 from $5.80.

"Positive events...lead us to believe that AMD's risk/reward is now compelling," he said. One of the biggest positives was AMD's move on Wednesday to pay off $1 billion in debt using part of its $1.25 billion settlement income from Intel and a new $500 million bond offering. "We believe AMD's debt of $3.7B will be reduced by 25 percent," Freedman said.

And Future "Fusion" chips point toward a more competitive AMD. Fusion silicon--which combines the main CPU processor with the graphics chip or GPU--is due in 2011. "We believe Fusion (CPU+GPU) will deliver discrete-like performance on an integrated chip," Freedman said, referring to high-performance standalone "discrete" graphics processors. "Fusion will likely be a low-cost product--targeting mainstream and lower-end," according to Freedman.

Chips that go into servers are also likely set for market share gains, Freedman said. "We estimate that server share could grow from ~8 percent currently, by our own forecast, to ~12 percent by FY10 year-end," he wrote. High-end "Maranello" chips boasting as many as 12 processing cores are due in the first half of next year and 16-core processors are coming in 2011.

Graphics chips that are compatible with Windows 7 DirectX 11 technology for accelerating games and general multimedia tasks are also expected to do well, such as the company's HD 5000 series of graphics chips.