Advanced Micro Devices’ (NASDAQ: AMD) news cycle gained momentum following its AI event in early June, and the share prices are following suit.
The takeaway is that the MI350 line lives up to the expectation, but the upcoming MI400 is the critical development.
It is the culmination of AMD’s lean into AI, GPU technology, and scalability, marking an inflection point for the semiconductor business.
It is widely accepted that AMD GPU technology offers several advantages over NVIDIA’s (NASDAQ: NVDA), including a better cost-to-performance ratio and superior memory capacity, which are well-suited for larger and more complex AI workloads.
The inflection will come when AMD delivers a rack-scale solution to its end-markets, opening the gate to a flood of potential consumers looking to capitalize on it.
Analysts Supercharge AMD’s Market: Lead It Into A Complete Reversal
The analysts’ response to the news is the driving force in the news cycle. MarketBeat tracked nine revisions within two weeks of the event, and all either reiterated their prior ratings and price targets or increased price targets, upgraded, or both. The net result is that current coverage for AMD stock (revisions issued within the last 12 months) spiked to a record high on MarketBeat’s platform.
The analysts' sentiment also firmed, with several Strong Buy or Outperform equivalents entering the mix. Regarding the consensus price target, the rebound in its trend, which began earlier this year, gained momentum. It is rising along with the stock price rebound in late June, with the high-end range aligning with the record highs set in early 2024, providing strong support for the market.
Notable revisions include the upgrades from Melius and CFRA. Together, they support the view that AMD can gain market share from NVIDIA and provide a timeline for this event. Melius believes AMD’s product offerings will be more appealing to hyperscalers and governments, and the rising demand for inferencing will benefit its business.
The firm's analysts upgraded to Strong Buy from Hold and set their target at $175, a 20% gain from the critical resistance point in late June. This indicates increased confidence in what will be a historic stock price run.
CFRA is equally bullish, upgrading the stock to Strong Buy from Buy, citing the product pipeline in the note. They believe AMD’s competitive edge is improving and that it will close the gap with NVIDIA in 2026. Underlying demand, amplified by client wins will drive market share gains as evidenced by recent partnerships with Oracle (NYSE: ORCL), Meta Platforms (NASDAQ: META), and OpenAI. They set a target of $165, increasing it roughly 30% in a single revision.
The Catalyst and Outlook for AMD’s Stock Price Reversal is the Q2 Results
The upcoming FQ2 earnings report, expected in late July, could propel this stock to new highs.
The analysts have a high bar, expecting growth to accelerate to nearly 40% according to MarketBeat’s reported consensus, but outperformance is possible due to the industry trends.
However, it is the guidance that moves stocks and sustains the gains; if AMD’s guidance affirms the faith put into it by analysts, new highs are likely and may come before the year’s end.
The technical action is robust. AMD’s market confirmed a bottom earlier this year as the analysts' sentiment shifted, and it is now in reversal mode. The move above the cluster of EMAs in June is critical; the next key trigger point is the resistance target near $147.50.
It aligns with price action in 2024 and may cap gains until the Q2 report is released. However, once crossed, regardless of the timing, a move to the $175 to $185 region is likely.
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