L1 Capital International, an investment management company, released its “L1 Capital International Fund” third-quarter 2022 investor letter. A copy of the same can be downloaded here. The fund returned -0.4% net of fees in the third quarter compared to a 0.3% return for the MSCI World Net Total Return Index in AUD. The depreciation of Australian dollars against the USD and Euro added to the fund’s reported and benchmark returns. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.
L1 Capital International highlighted stocks like Advanced Micro Devices, Inc. (NASDAQ:AMD) in its Q3 2022 investor letter. Headquartered in Santa Clara, California, Advanced Micro Devices, Inc. (NASDAQ:AMD) is a semiconductor manufacturing company. On December 6, 2022, Advanced Micro Devices, Inc. (NASDAQ:AMD) stock closed at $70.27 per share. One-month return of Advanced Micro Devices, Inc. (NASDAQ:AMD) was 17.27% and its shares lost 51.62% of their value over the last 52 weeks. Advanced Micro Devices, Inc. (NASDAQ:AMD) has a market capitalization of $115.393 billion.
L1 Capital International made the following comment about Advanced Micro Devices, Inc. (NASDAQ:AMD) in its Q3 2022 investor letter:
“The share price of Advanced Micro Devices, Inc. (NASDAQ:AMD) was weak during the quarter and weakened further in early October when the pre-announced revenue was significantly below prior guidance, reflecting an acute slowdown in the PC market. Data centre related revenue grew strongly, albeit below our expectations, while gaming and embedded revenue was in line with our base case.
Geopolitical risks have increased for the semiconductor sector, with the U.S. Government announcing restrictions on the sale of certain technologies to China. Despite near term headwinds, AMD is well positioned for the medium term, with a technology lead over Intel in servers for data centres and rapidly gaining share in the PC/notebook sectors. Its gaming and embedded applications continue to grow strongly. AMD is a very capital light business, with manufacturing outsourced. After expending nearly $5b on research and development, AMD generates around $5b of free cashflow. With a net cash balance sheet, we expect management will accelerate buyback activity at a share price well below fair value.
The share price of our more cyclical businesses, in particularly the building products companies which have exposure to the U.S. residential, repair and renovation and infrastructure sectors, were broadly flat for the quarter. Rapidly escalating mortgage rates and rapidly reducing affordability will have a pronounced negative effect on near term new residential construction activity. We believe these cyclical pressures are well understood and are more than reflected in current share prices. Overall, we strongly believe share prices are overly reflecting near-term challenges and our portfolio of companies are now meaningfully undervalued.”
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Advanced Micro Devices, Inc. (NASDAQ:AMD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 89 hedge fund portfolios held Advanced Micro Devices, Inc. (NASDAQ:AMD) at the end of the third quarter, which was 87 in the previous quarter.
We discussed Advanced Micro Devices, Inc. (NASDAQ:AMD) in another article and shared recent additions to Jim Cramer stock portfolio. In addition, please check out our hedge fund investor letters Q3 2022 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
