Shares of Advanced Micro Devices (AMD) have shown significant growth in premarket trading following an analyst upgrade linked to improvements in artificial intelligence capabilities.
Analyst Upgrade by Melius Research
Ben Reitzes from Melius Research upgraded AMD’s rating from 'hold' to 'buy,' raising the price target from $110 to $175. This implies a potential upside of 59% from the current stock price of approximately $129.58. Reitzes pointed to substantial improvements in AMD’s chip capabilities and computing systems as key drivers for the upgrade.
Market Positioning in AI
AMD’s stock has demonstrated remarkable resilience, closing on Monday at $129.58, up 1.04%. Year-to-date performance stands at 7.28%, significantly outpacing the S&P 500’s 2.44% gain over the same period. Despite volatility, AMD maintains positive momentum, posting impressive longer-term returns.
Strategic Partnerships and Future Prospects
AMD’s focus on artificial intelligence positions the company well for future growth. The company is actively developing partnerships with HCLTech and Microsoft for AI and cloud solutions. While the analyst cautioned about the inherent volatility of AMD’s shares, he believes this presents an attractive entry point for investors.
Support from analysts and strategic positioning in the rapidly evolving AI segment may contribute to further growth of AMD shares in the coming years.
