1 Stock to Buy, 1 Stock to Sell This Week: AMD, Delta Air Lines – Yahoo Finance

October 6, 2024

This week will focus on inflation data, the Fed's FOMC minutes, and the start of third-quarter earnings season.
AMD is a buy as it holds its annual “Advancing AI 2024” event.
Delta Air Lines is on sale due to disappointing results and a weak outlook.
Looking for more practical trading ideas to weather the current market volatility? Get access to InvestingPro for less than $8 a month!

Wall Street stocks ended higher on Friday, with the Dow Jones Industrial Average closing at an all-time high after U.S. jobs data eased fears of a recession.

All three major US stock indexes recorded gains for the fourth straight week, with the blue-chip Dow and benchmark S&P 500 both up about 0.2% over the same period. The Nasdaq Composite Index, which has a high proportion of tech stocks, rose 0.1% for the week.

Source: Investing.com

Next week is expected to be another volatile week as investors continue to assess the outlook for the economy and interest rates.

Most important on the economic calendar is Thursday's September U.S. Consumer Price Inflation Report, with annual CPI expected to rise 2.3%, slowing from the 2.5% rise recorded in August. .

The CPI data also includes the latest figures on producer prices, which can help you understand the state of inflation.

Source: Investing.com

Also on the agenda will be the minutes of the US Federal Reserve's September FOMC policy meeting, scheduled for Wednesday.

As of Sunday morning, investors thought there was a 93% chance the Fed would cut interest rates by 25 basis points at its November meeting, and a 7% chance it would do nothing, according to Investing.com's Fed Monitor tool.

Elsewhere, JPMorgan Chase (NYSE:JPM), Wells Fargo (NYSE:WFC), BlackRock (NYSE:BLK), PepsiCo (NASDAQ:PEP), Delta Air Lines (NYSE:DAL) and some big names will be reported.

Regardless of which direction the market goes, here are stocks that are likely to be in demand and that are poised for new downside. However, my time frame is: just For the next week, From Monday, October 7th to Friday, October 11th.

Brand to purchase: Advanced Micro Devices

Advanced Micro Devices (NASDAQ: AMD) stands out as a top buy this week, with the highly anticipated Advancing AI 2024 event expected to be a big boost for chip stocks.

AMD stock rose 5% on Friday, ending the week at $170.90, its highest level since July 16. The semiconductor company's stock is up 16% year-to-date. At its current valuation, Santa Clara, California-based AMD has a market capitalization of $276.6 billion.

Source: Investing.com

AMD's high-profile AI event will be held in San Francisco on Thursday at 12:00 PM ET and will highlight AMD's next-generation Instinct accelerators and 5th generation AMD EPYC server processors, key products in the AI and high-performance computing space. Shine the spotlight.

Additionally, AMD will discuss innovations in networking, AI PC updates, and the AI solution ecosystem.

Spearheaded by CEO Lisa Su, the event will also include AMD executives, ecosystem partners, and developers to discuss the technology company's transformative role in reinventing AI and high-performance computing.

AMD stock tends to rise during weeks when AI events take place. Last year, the stock soared nearly 10% the day after the event, and analysts are expecting a similar reaction this time around.

The chipmaker has a strong track record of receiving upgrades from multiple analysts after major product presentations.

As noted by InvestingPro, AMD has an above-average financial health score of 3.0/5.0, supported by its positive profitability outlook and strong revenue growth outlook with buzz around next-generation AI products .

Source: InvestingPro

To stay on top of market trends and what they mean for your trading, be sure to check out InvestingPro. Subscribe to InvestingPro today with a special 10% discount and keep your portfolio ahead of everyone else.!

Stock to be sold: Delta Air Lines

By contrast, Delta Air Lines faces increasing headwinds ahead of its third-quarter earnings release Thursday at 6:30 a.m. ET. Sluggish consumer spending and soaring oil prices due to the harsh economic environment are putting pressure on Delta Air Lines' profitability and profits.

As expected, an InvestingPro survey of analyst earnings revisions found that all 16 analysts covering Delta Air Lines have lowered their earnings estimates in the past 90 days, ahead of the third-quarter print. It became clear that pessimism was on the rise.

Source: InvestingPro

Market participants expect DAL stock to move significantly after the print decline, with a 6.5% move in either direction expected, according to the options market.

Earnings have been the catalyst for significant stock price swings this year, with Delta's stock price down nearly 7% in July, when the airline last reported quarterly results, according to InvestingPro data.

Wall Street expects the Atlanta, Georgia-based airliner to report earnings of $1.53 per share, a 24.6% decline from last year's EPS of $2.03. This significant decline is due to higher operating costs and narrower operating margins, weighing on the company's bottom line.

Delta Air Lines, on the other hand, is expected to see a modest 4.4% increase in revenue, up to $15.2 billion.

Looking ahead, Delta Air Lines CEO Ed Bastian said the airline's fiscal year 2025 forecast reflects continued concerns about weak air travel demand, rising fuel costs and increasing pressure from broader economic concerns. likely to signal a cautious tone regarding the outlook.

DAL stock closed Friday at $49.28. The stock price in 2024 will rise by 22.5%.

Source: Investing.com

At its current valuation, Delta Air Lines has a market capitalization of $31.6 billion, with Ryanair (NASDAQ:RYAAY), United Airlines (NASDAQ:UAL), Southwest Airlines (NYSE: LUV), LATAM Airlines (NYSE:LTM), American Airlines (NASDAQ:AAL).

Whether you are a novice investor or a seasoned trader, investment professional You can unlock global investment opportunities while minimizing risk in a challenging market backdrop.

Subscribe now Unlock access to some market-leading features such as:

Advanced stock screener: Find the best stocks based on hundreds of filters and criteria of your choice.
InvestingPro fair value: Instantly determine whether a stock is undervalued or overvalued.
AI Propic: Winner stocks with a proven track record carefully selected by AI.
Popular ideas: See what stocks billionaire investors like Warren Buffett, Michael Burry, and George Soros are buying.

Disclosure: As of this writing, I am long the S&P 500 and Nasdaq 100 through the SPDR® S&P 500 ETF and the Invesco QQQ Trust ETF. I'm also long the Technology Select Sector SPDR ETF (NYSE:XLK).

I regularly rebalance my portfolio of individual stocks and ETFs based on an ongoing risk assessment of both the macroeconomic environment and corporate finances.

The views expressed in this article are solely those of the author and should not be taken as investment advice.

X/Follow Jesse Cohen on Twitter @JesseCohen For more stock market analysis and insight.

1 stock to buy, 1 stock to sell this week: AMD, Delta Air Lines

Schwab US Dividend Stock ETF: Unlock passive income with high returns

S&P 500 Earnings: Financials Face Challenging Conditions from Q3 to Q23