AI, Machine Learning Innovator Rambus Launches New Breakout



As artificial intelligence (AI) and machine learning continue to advance, Nvidia (NVDA) and Advanced Micro Devices (AMD) industry partner Rambus (RMBS) continues to solve the bottleneck between memory and processing for the computing, gaming and graphics industries. 0% 

And earning a spot on the IBD Breakout Stocks Index, RMBS stock has now mapped out a new breakout.

Based in Silicon Valley, Rambus develops high-performance memory subsystems. It provides interfaces and related technologies that chipmakers and systems companies use to maximize the performance and security in data-intensive systems. Rambus products deliver the increased bandwidth, capacity and security required to usher in a new era of data center architectures.

To advance AI and machine learning, Rambus has announced a new high-bandwidth memory (HBM) subsystem. The 8.4 Gps HBM3-ready memory subsystem delivers over a terabyte per second of bandwidth, more than double the bandwidth of high-end HBM2E memory subsystems.

See Who Joins AI Innovator Rambus On The IBD Breakout Stocks Index

Semiconductor Sector Strength, Big Growth Lifts Rambus

The fabless semiconductor industry ranks a very strong No. 2 out of the 197 groups IBD tracks. Several Rambus industry peers and fellow AI and machine learning leaders, including NvidiaAMD and MaxLinear (MXL), earn the highest-possible 99 Composite Rating. With a 97 Composite Rating, Rambus also earns high marks in Stock Checkup.

Like its partners Nvidia and AMD, and analog and mixed-signal-chip maker MaxLinear, Rambus has been generating impressive growth. Over the last three quarters, it has produced average EPS growth of 422%, including a 600% spike in its Nov. 1 report. Analysts expect a 640% jump in Q4 and a 744% EPS increase for the full year. Estimates for 2021 top those for Nvidia (66%), AMD (105%) and MaxLinear (205%).

While not joining Nvidia and AMD on the latest list of new buys by the best mutual funds, 17 funds with an A+ rating from IBD owns shares in Rambus. But while the relative strength lines for AMD, MaxLinear and Nvidia stock have moved sharply higher, the RS line for Rambus remains off its prior highs but has started to trend higher.

Rambus Sets Up While Fellow AI Leaders Remain Extended

With the fabless semiconductor group showing market-leading strength, Nvidia, AMD and MaxLinear are all extended from their most recent breakouts.

Meanwhile, Rambus has just completed a cup with handle and cleared a 24.99 entry. It’s a first-stage consolidation since Rambus undercut the low in its prior chart pattern to reset the base count. In another sign of rebounding technical strength, the 21-day moving average has climbed back above the long-term 50-day line.

Several recent daily spikes in upside volume point to rising demand for Rambus as the stock continues to base. On the daily chart, you can see the number above-average increases in upside volume clearly outnumber heavy-volume down days since June.

Rising volume continued Wednesday as Rambus jumped over 5% in massive trade, 263% above average.

Look for rising demand to continue as Rambus tries to leverage its AI and machine learning innovations into a sustained new climb.

IBD Breakout Opportunities ETF

The IBD Breakout Opportunities ETF from Innovator Capital Management tracks the IBD Breakout Stocks Index. As with other index ETFs, this fund allows you to essentially invest in the entire index in addition to or rather than buying the individual stocks. Learn more here about the ETF and Innovator funds.

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