(By Salman - iStockAnalyst Writer)So far it has been a spectacular earnings season for the bulls. The S&P 500 has gained over 15% in the three month period ended August 27, 2009. Stocks of several companies have failed to rally as they still face just as many challenges as they did during 2008, if not more.
Below we highlight few
individual stocks that have remained
under performers this season.
1.
Advanced Micro Devices Inc. (NYSE:
AMD): The chipmaker has not managed to post a profit in last 11 quarters. On July 21, 2009 AMD announced that it suffered a loss of $ 335 million for the second quarter of 2009.Revenue plunged 13% from $1.36 billion for the same period last year. The company has been hit hard by a slump in chip industry and has been fast losing its market share to industry leader Intel Corp. (NASDAQ:
INTC).According to Gartner Inc., worldwide chip revenue is on track to drop 17% on a year-over-year basis in 2009. That projection is less severe than an earlier forecast of a 22% decline for the year. AMD posted a loss of $3.09 billion for FY 2008, while Intel's net income was $5.2 billion giving AMD a huge disadvantage when trying to allot money towards R&D ($5.722B by Intel compared to AMD's $1.84B). In the rapidly growing netbook market, where Intel's atom processor is the market leader, AMD still doesn't have presence.
A recent report by Mercury Research, showed that,
AMD's market share slipped from 20.9 percent to 18.7 percent in the second quarter, lower than the 18.8 percent share the firm recorded in the second quarter of 2008. Intel, meanwhile, saw its share increase from 80.0 percent a year ago to 80.5 percent, up from 78.2 percent during the first quarter of 2009. Recent price war between Intel and AMD has taken a heavy toll on the latter. Because Intel is much bigger than AMD, it is able to cut costs more effectively and as a result the losses in profit margins do not affect Intel as severely. AMD's adjusted gross margin has plummeted from 45% in third quarter 2008 to 29% in second quarter 2009. The balance sheet of the company is far too debt burdened and actually has negative shareholder equity. Shares of the company are down over 10% in the three month period ended August 27, 2009.
2.
Evergreen Solar (NASDAQ:
ESLR): Solar stocks suffered major blow due to the turmoil in the credit market as financial players abandoned U.S. solar energy projects last year. The financial crisis cut Evergreen's access to capital, forcing it to close its Marlboro plant and delay construction of its $800 million plant in Asia in 2008.Though there has been a marked improvement in credit environment, the company has not been really able to recover from the shocks. Globally, solar industry depends upon government subsidies and incentives.
