AMD vs. Intel- Again

In May of 2006, I wrote this post on the then-resurgent AMD. Back in April of this year, I followed up with the shocking news that AMD had, in fact, screwed up its big opportunity.

As a backdrop, the nearby Yahoo-sourced price chart for AMD, Intel and the S&P500 Index display the story for the past five years.

AMD had actually peaked just before that 2006 piece, and has been steadily declining ever since.

Intel, true to my prediction, has never really risen to be a consistently superior total return performer again, like it was just over a decade ago. In fact, over the five years, the two both lost money for their shareholders, with AMD faring slightly worse.

Now, in a Wall Street Journal article earlier this week, AMD announced that Dirk Meyer, AMD's president and COO, will take over as CEO, too, from Hector Ruiz.

It's a sad tale of the second-rate firm nearly besting its perennial enemy, only to stumble when given a chance. Ruiz apparently lost focus, got the company over-extended, and missed important product delivery timelines.

Meyer sounds like the ticket to at least halt the bleeding at AMD. He is quoted as saying he will focus on execution and narrowing AMD's efforts to those product/markets in which they hold clear superiority over competition- read Intel.

On the other hand, some say he was a key player in the mistakes that led AMD to this point.

Honestly, either way, I don't think either chip maker would be on my equity/options selection lists anytime soon. The sector just seems too prone to erratic performance and an inability to overcome obstacles to delivering shareholders consistently superior returns.