Remember Advanced Micro Devices?

Investors and Wall Street have forgotten about Advanced Micro Devices (NYSE:AMD) and their share price shows it.  AMD shares are trading $1 or so above it's 52-week low.  But with the recent $622 million investment by Mubadala Development Co should we all rethink our bear AMD positions?

AMD versus Intel (NASDAQ:INTC) which is the better investment?  I'm sick of reading those comparisons, I don't care who is going to make more money, all I care about is the return on investment, good ol' ROI.  That's all investors and day traders care about -- how much money can I make from this stock?  Hands down Intel is the better company, no question, and their stock price reflects the positive direction the company has achieved in the last 6 months:

I'm not interested in trying to squeeze a few points from Intel before it hits a new 52-week high just $2 from now, I want the big gain.  Does AMD have the right stuff to get shares back into the $20's and does the Middle East investment tell us anything about what's to come?

First off, who gives a rip what I think, let's get Wall Street's opinion via CNN:

Analyst Crawford Del Prete of International Data Corp. said the Abu Dhabi investment takes care of AMD growing cash problem.

"What you're seeing is they are at a burn rate in which they need to raise more money," he said. "This solves a relatively short-term problem, but it still doesn't fix the longer term problem, which is the need to generate cash faster."

Analyst Cody Acree of Stifel, Nicolaus & Co. said AMD could use the Mubadala investment to eliminate high-yield debt and cover operating expenses.

"Overall, we view this announcement as a positive for shares of AMD as financing of near-term operations has been a reoccurring issue that has continually weighed on AMD's valuation," he wrote in a research note. "We expect this announcement will give investors a reason to take another look at AMD."

Analyst Roger Kay, president of Endpoint Technologies Associates, which does consulting work for AMD, said the deal gives the company a short term relief.

"They need working capital and they got some from a friendly, neutral third party whose interests are financial," he said.

Then of course there are the Negative Nancy's saying AMD is garbage, they have too much debt and Intel, Intel, Intel - Marsha, Marsha, Marsha (queue Jan's annoying voice).

Take the recent investment by Mubadala Development for what it is -- some group is willing to thrown down millions to get an 8% stake in the company.  Investment groups don't buy shares unless they believe they can get what we want --  ROI.  These guys are looking to turn their $622 million into $1 billion, more like $1.5 to $2 billion. 

AMD is not a pretty picture right now, sure shares are only $12 and change, but they aren't bringing in a profit and if they don't get their act together soon, it's going to get worse. AMD's short % of the float is at 13% vs. Intel's short float is only 1% -- its clear AMD is not the runner-up but the guy in last place.  However, AMD still brought home $5.6 billion in revenue last year, not bad for a 'crap' company that nobody cares about anymore.

Mubadala Development is looking to make money from AMD, they've invested millions, so why not make a position for a few hundred bucks and take a chance on speculation?

Article by Frank Lara Jr.

Contributor at TheStockMasters.com

Disclaimer: The Author does not hold any positions or shares in the securities mentioned in this publication.

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