Nvidia's (NASDAQ: NVDA) dominance of the market for data center graphics processing units (GPUs) has supercharged the stock in 2023. Shares of the semiconductor giant have nearly tripled so far this year, which seems justified given how artificial intelligence (AI)-fueled demand
Investors in Advanced Micro Devices Inc (Symbol: AMD) saw new options begin trading today, for the September 2024 expiration. One of the key data points that goes into the price an option buyer is willing to pay, is the time value, so with 441 days until expiration the newly t
Chip stocks have been enjoying a lot of attention since the generative
artificial intelligence (AI) wave hit the tech world following the launch of
OpenAI’s ChatGPT. Shares of Advanced Micro Devices (
NASDAQ:AMD
) have rallied over 75% year-to-date, as investors are upbeat about AI-led demand for chips. While some analysts are skeptical about AMD due to the dominance of Nvidia (
NASDAQ:NVDA
) in the AI space, others are optimistic about the company’s potential and see continued upside in the stock.
AMD Set to Capture the AI-Induced Demand
Over the years, AMD has successfully grabbed CPU (central processing unit) market share from Intel (
NASDAQ:INTC
). However, when it comes to the GPU (graphics processing unit) market, Nvidia is the clear leader. Based on AI-led demand,
Nvidia guided for around $11 billion in revenue for the fiscal second quarter, which crushed Wall Street’s expectations. The blowout guidance triggered a rally in NVDA, with the stock joining the $1 trillion market cap club.
Last month, AMD’s CEO
Lisa Su provided details about the company’s forthcoming advanced GPU chip (MI300X) for AI applications. The company said that its MI300X chip and CDNA architecture were designed for large language models and other advanced AI applications. AMD expects mass production of MI300X to begin in the fourth quarter.
Following AMD’s new AI chip announcement,
Bernstein analyst Stacy Rasgon stated that while the AI opportunity for companies is in the early stages, AMD’s efforts still seem somewhat late, given that its rival “already has the roadmap, ecosystem, and track record across compute, hardware, software, networking, and application expertise and who is bending the market to their will.”
Rasgon thinks that even if the AI data center's total addressable market worth $150 billion materializes by 2027, it might still be more bullish for Nvidia than others. Rasgon reiterated a Hold rating on AMD with a price target of $80.
Meanwhile,
TD Cowen analyst Matthew Ramsey opined that AMD’s AI event “articulated a clear strategy” for the company to lead and win further market share in the server CPU market. He also noted that AMD highlighted how its diverse portfolio of CPU, GPU, Field Programmable Gate Arrays (FPGA), and networking offerings can be customized for many workloads, including AI inference and training.
On Wednesday,
Northland Securities analyst Gus Richard upgraded AMD stock to Buy from Hold and boosted the price target to $150 from $81.
The analyst acknowledges Nvidia’s dominance in AI, but thinks that AMD’s upcoming MI300X and El Capitan supercomputer could enhance its GPU
revenue in the second half of 2023.
Further, Richard feels that AMD’s open-source software approach “likely reduces NVDA software moat.” He also highlighted that AMD has intellectual property (IP) for AI beyond GPUs.
Is AMD Stock a Buy, Sell, or Hold?
Wall Street’s
Strong Buy consensus rating on AMD stock is based on 22 Buys and seven Holds. The average price target of $136.69 implies 20% upside.
Conclusion
Most Wall Street analysts are bullish about AMD’s growth prospects in data centers, the embedded segment, and generative AI applications. Analysts' average price target indicates further upside in AMD stock.
Disclosure
Below is Validea's guru fundamental report for ADVANCED MICRO DEVICES, INC. (AMD). Of the 22 guru strategies we follow, AMD rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundam
Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Triumph Financial Inc (Symbol: TFIN), where a total volume of 1,000 contracts has been traded thus far today, a contract volume which is representative of appro
In this video, I will discuss how Nvidia's (NASDAQ: NVDA) biggest threat might not be Advanced Micro Devices (NASDAQ: AMD). Check out the short video to learn more, consider subscribing, and click the special offer link below.
Investors often turn to recommendations made by Wall Street analysts before making a Buy, Sell, or Hold decision about a stock. While media reports about rating changes by these brokerage-firm employed (or sell-side) analysts ofte
Wall Street ended lower on Wednesday, pulled down by materials and tech stocks. Indexes ended the session with modest losses after the minutes from the last Fed meeting were released. All three major indexes ended in the red.
Below is Validea's guru fundamental report for ADVANCED MICRO DEVICES, INC. (AMD). Of the 22 guru strategies we follow, AMD rates highest using our Twin Momentum Investor model based on the published strategy of Dashan Huang. This momentum model looks for a combination of fundam
There's no question that Advanced Micro Devices (NASDAQ: AMD) has failed to keep up with rival NVIDIA (NASDAQ: NVDA) in the data-center GPU market. While AMD sells data-center GPUs of its own, aimed at accelerating a wide variety of workloads, estimates for NVIDIA's share in the
GlobalFoundries (GFS) is the third largest semiconductor foundry in the world behind Taiwan Semi (TSM) and Samsung. Recent company updates scaled back immediate growth prospects, and that's why the stock is a Zacks #5 Rank.GFS off
Tech stocks roared back, wrapping up the first six months with massive gains. The prospect of less aggressive interest rate hikes in the future, moderation in the inflation rate, and the grand entrance of Generative
AI (Artificial Intelligence) are behind investors’ buoyant mood. While the economy still exhibits weakness and valuations appear rich, the recovery in cloud computing and AI-led opportunities indicate that the bull run in tech could sustain in the second half of 2023.
While the sector is expected to benefit from secular trends, investors should note that there could be select buying opportunities across the tech landscape in the second half of this year. But before we move ahead, let’s look at the recent price performance of technology stocks.
Tech Stocks – The Stellar 1H Price Performance
Contrary to the fears of recession and weak end-market demand, the buzz around AI led Nvidia's (
NASDAQ:NVDA
) stock to
attain $1 trillion in market cap. Meanwhile, shares of Meta Platforms (
NASDAQ:META
) are up about 145% year-to-date, thanks to the implementation of deep cost-cutting measures and growing momentum in its products and platforms.
At the same time, Amazon's (
NASDAQ:AMZN
) stock has gained over 55%, reflecting the easing of the inflationary environment, cost-cutting initiatives, and an expected recovery in its AWS (Amazon Web Services) segment.
Apple's (
NASDAQ:AAPL
) stock grew about 48% due to the momentum in Services revenue and easing supply-chain headwinds. Meanwhile, Microsoft (
NASDAQ:MSFT
) and Alphabet (
NASDAQ:GOOGL
)(
NASDAQ:GOOG
) stocks also defied the weak general market trend and have gained 42% and 38, respectively, on a year-to-date basis.
Thanks to this recovery, the tech-heavy NASDAQ 100 Index (
NDX
) is up about 39%. Further, tech and AI-focused ETFs (
Exchange-Traded funds) like the Invesco QQQ Trust (
QQQ
) and Global X Robotics & Artificial Intelligence ETF (
BOTZ
) have also delivered substantial gains and witnessed
large inflows of cash.
The 2H 2023 Outlook
Thanks to the solid secular tailwinds, it is hard to find shorts among these large tech companies. Exposure to generative AI, a recovery in cloud computing, and a rebound in end-market demand could continue to fuel growth for these companies.
TipRanks’
Stock Comparison tool shows that Wall Street analysts are bullish about these tech stocks. All of these stocks command a Strong Buy consensus rating on TipRanks. However, analysts’ average 12-month price targets show limited upside potential.
Nvidia is the only big tech stock offering double-digit upside potential based on the average price target. Despite the stellar gains, the double-digit upside potential in NVDA stock shows the recognition of NVDA’s leadership in the AI space.
Besides for NVDA, shares of Amazon could exceed analysts’ average price target, reflecting reacceleration in AWS’ growth rate, AI-led tailwinds (AWS’ Generative AI offerings), and cost-saving measures.
Besides for these mega-cap stocks, the
Top Wall Street analysts are also bullish about Advanced Micro Devices (
NASDAQ:AMD
), CrowdStrike (
NASDAQ:CRWD
), ACM Research (
NASDAQ:ACMR
), Axon Enterprise (
NASDAQ:AXON
), and EngageSmart (
NYSE:ESMT
).
These tech stocks offer decent upside potential over the next 12 months based on analysts’ price targets.
Bottom Line
Despite macro uncertainty, the recent rally in technology stocks shows investors’ optimism in the sector. Further, analysts’ Strong Buy consensus rating on these stocks also substantiates the bullish view. Moreover, the expected increase in IT spending by enterprises on cloud and AI applications bodes well for growth.
Disclosure
The average one-year price target for Advanced Micro Devices (NASDAQ:AMD) has been revised to 133.01 / share. This is an increase of 25.56% from the prior estimate of 105.93 dated June 1, 2023. The price target is an average of many targets provided by analysts. The latest targ
Fintel reports that on July 5, 2023, Northland Capital Markets upgraded their outlook for Advanced Micro Devices (NASDAQ:AMD) from Market Perform to Outperform . Analyst Price Forecast Suggests 14.84% Upside
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Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares U.S. Technology ETF (Symbol: IYW) where we have detected an approximate $402.3 million dollar outflow -- that's a 3.1% decrease week over we
As the tech market develops, demand for powerful chips is soaring. Countless industries including gaming, artificial intelligence (AI), cloud computing, and virtual/augmented reality (VR/AR) require more-advanced hardware. As a result, chipmakers like Advanced Micro Devices (NASD