Several analysts have already weighed in on the cash need at Advanced Micro Devices (AMD). Today, Merrill Lynch joined that chorus. The comment from Merrill as quoted in Barron’s: “the market may still not appreciate just how much money AMD is likely to lose in Q1 and Q2 as it struggles to work off 90nm product inventory.”

May not appreciate, indeed. Raising over $1 billion against the company’s market cap of $7 billion could drive the stock even further down than where it is now at a 52-week low of $12.67.

Now that there is a perception that Intel (INTC) has gained at least parity in its chip offerings, AMD has a very hard road ahead.

Douglas A. McIntyre