Advanced Micro Devices Inc. (AMD) is experiencing a significant surge in its stock price, nearing its record closing high. The recent surge reflects growing optimism for the company’s opportunities in artificial intelligence (AI). Currently, AMD’s stock is up more than 7% and trading at $157.67, putting it less than 3% away from its all-time closing high of $161.91 achieved in November 2021.
The rally in AMD’s stock is part of a broader gain in chip stocks, with the PHLX Semiconductor Index up 1%. Despite a slightly negative day for the Nasdaq Composite Index, shares of Nvidia Corp. are up 2.8%, and shares of Micron Technology Inc. are up 2.3%.
KeyBanc Capital Markets analyst John Vinh has recently provided positive commentary on AMD’s server business, particularly regarding the company’s MI300X accelerator for AI applications. Vinh believes that there has been a significant increase in demand for the MI300X, indicating that the software performance issues from last year have been resolved. Vinh expects Microsoft Corp. to increase its use of the MI300X in the first quarter, with other customers such as Meta Platforms Inc. and Oracle Corp. potentially following suit.
Vinh predicts that there is currently demand for 500,000 MI300X GPUs, which could generate approximately $8 billion in data center GPU revenues in 2024. This forecast is significantly higher than initial expectations of $3 billion to $4 billion. Vinh also mentions that AMD has expanded its Chip-on-Wafer-on-Substrate (CoWoS) packaging capacity and has the ability to support further upside if additional demand arises.
With this positive outlook, Vinh has raised his price target for AMD shares to $195, suggesting a 24% upside.
In other chip sector news, Taiwan Semiconductor Manufacturing Co. Ltd. shares are advancing by 0.5% following the victory of Lai Ching-te, the ruling-party candidate, in Taiwan’s presidential election. Analysts believe this outcome aligns with general expectations and is being closely monitored by global financial markets in light of elevated geopolitical concerns.
Overall, the surge in AMD’s stock and the positive sentiment surrounding the company’s AI opportunities demonstrate the growing recognition of AMD’s potential in the emerging field of artificial intelligence.
The source of the article is from the blog agogs.sk