Following Advanced Micro Devices’ (AMD) “Advancing AI 2024” event in San Francisco, analysts have provided mixed reactions regarding the company’s outlook, resulting in adjustments to AMD’s stock price targets, the Street reports.
While AMD unveiled new high-performance computing solutions, including the 5th Generation EPYC server CPUs and MI325X accelerators, the overall sentiment among investors and analysts was cautious.
At the event, AMD CEO Lisa Su announced that the MI325X would begin shipping at the end of this quarter, with partner products expected in early 2024. AMD also updated its forecast for the data-center AI accelerator market, estimating it will grow from $45 billion in 2023 to over $500 billion by 2028, an increase from its previous forecast of $400 billion by 2027.
However, some analysts were underwhelmed by the lack of surprises. Oppenheimer described the event as “largely uneventful,” noting that AMD’s roadmap was already well-known. The firm expressed concerns that investor expectations for AI-related revenue may be too high, forecasting $8 billion in 2025 instead of the $10 billion that many investors had hoped for. Oppenheimer remained cautious about AMD stock, refraining from issuing a recommendation until more clarity on the company’s AI vision emerges.
Wedbush analysts, while maintaining a positive outlook with an “outperform” rating and a $200 price target, noted that AMD did not update its AI sales guidance or announce any new major customers. The firm acknowledged that the market may have already priced in the potential for such developments, contributing to the stock’s limited movement following the event.
On a more optimistic note, Piper Sandler raised its price target for AMD from $175 to $200, affirming its overweight rating. Piper highlighted AMD’s growing opportunities in data centers and GPUs, emphasizing that the company is well-positioned to capture a significant share of the expanding AI-accelerator market. Piper continues to see AMD as its top pick among large-cap stocks.
Despite these mixed reviews, AMD’s stock closed at $167.89 on Friday, up 2.3% on the day but down 1.8% for the week. With continued focus on the company’s growth in AI and data-center technologies, analysts expect AMD’s stock to remain within a range of $150 to $180 for the near term, barring any major surprises or updates.
