Advanced Micro Devices has seen a notable increase in its Fair Value Estimate, rising from approximately $214 to $239 per share. Analysts are reevaluating the company’s prospects, and this upward revision reflects mounting optimism propelled by recent AI infrastructure wins and an expanding partnership with OpenAI. Stay tuned to discover strategies for following future shifts in the evolving AMD investment narrative.
The past several weeks have brought a flood of analyst commentary on Advanced Micro Devices, reflecting both the company’s new AI wins and the evolving sector backdrop. Below is a synthesis of the perspectives shaping AMD’s investment narrative.
🐂 Bullish Takeaways
Several firms have raised their price targets, spotlighting optimism about AMD’s AI-driven growth. Notably, Melius Research and Jefferies each hiked their targets to $300, reflecting conviction that AMD’s multi-year OpenAI deal accelerates its AI opportunity and validates its technology roadmap.
Wolfe Research upgraded AMD to Outperform with a $300 target, emphasizing the potential for $10-plus in earnings per share as AMD executes on this partnership with OpenAI and possibly wins further cloud and server business.
Stifel and Piper Sandler both boosted price targets to $240, citing AMD’s co-design role in OpenAI’s infrastructure and expectations for broader adoption of Instinct accelerators.
KGI Securities, DBS Bank, and Roth Capital separately upgraded or reiterated bullish stances with price targets now above $250, pointing to AMD’s traction as a credible supplier of large-scale AI solutions.
Morgan Stanley and Deutsche Bank also increased their price targets. Morgan Stanley to $246 and Deutsche Bank to $230. Both noted the magnitude of the OpenAI agreement and AI ecosystem momentum, though Morgan Stanley urges AMD must still prove it can out-execute Nvidia, the incumbent leader.
Some bullish analysts, including Melius Research, highlight the possibility of financial upside if AMD delivers on execution, while also flagging the potential impact of dilution from warrant issuance as part of the OpenAI deal.
🐻 Bearish Takeaways
A minority of firms maintain a more cautious view. Seaport Research downgraded AMD to Neutral, citing concerns about slowing AI accelerator growth and raising questions on the sustainability of the current momentum.
Erste Group recently downgraded AMD to Hold, pointing to persistent operating margins below sector average and a valuation that the firm considers stretched, given the company’s recent financial performance.
Even some neutral-to-bullish firms, including Deutsche Bank, maintain Hold ratings after raising price targets, reflecting reservations about high valuation and the risk that much of the positive narrative is already priced into current share levels.
Story Continues
Taken together, the latest analyst consensus underscores enthusiasm over AMD’s AI infrastructure wins, its deepening relationship with OpenAI, and the company’s accelerating revenue and earnings potential. However, a segment of the Street continues to watch AMD’s execution, margins, and valuation closely, signaling that while expectations are on the rise, the bar for outperformance is set high.
Do your thoughts align with the Bull or Bear Analysts? Perhaps you think there’s more to the story. Head to the Simply Wall St Community to discover more perspectives or begin writing your own Narrative!
NasdaqGS:AMD Community Fair Values as at Oct 2025
Oracle Cloud Infrastructure announced plans to deploy 50,000 AMD AI GPUs beginning in the second half of 2026. This move highlights the growing adoption of AMD chips among major cloud service providers seeking alternatives to Nvidia for artificial intelligence workloads.
OpenAI and AMD have finalized a multibillion-dollar partnership for AI data centers, with OpenAI committing to purchase 6 gigawatts of AMD’s forthcoming MI450 chips over the next five years. As part of the agreement, OpenAI could receive warrants for up to 160 million AMD shares, contingent on fulfillment of deployment milestones.
Nvidia CEO Jensen Huang publicly reacted to AMD’s OpenAI deal, expressing surprise over the large amount of potential equity, up to 10 percent of AMD, granted to OpenAI as warrants in connection with the partnership.
Sony and AMD jointly revealed early information on next-generation GPU technology for the upcoming PlayStation console, signaling co-developed advancements aimed at high-performance gaming experiences.
The Fair Value Estimate has increased from approximately $214 to $239 per share. This reflects a notable upward revision in analysts’ assessment of AMD’s intrinsic value.
The Discount Rate has declined slightly, moving from 10.12% to 10.09%. This indicates marginally lower perceived investment risk or cost of capital for the company.
Revenue Growth Projections have risen, climbing from 27.3% to 29.3%. This suggests greater confidence in AMD’s future sales expansion.
The Net Profit Margin forecast has improved modestly, from 17.4% to 17.5%. This points to expectations of slightly stronger profitability.
The Future P/E Ratio estimate has increased from 43.6x to 46.2x. This highlights a richer valuation multiple assigned to future earnings.
Narratives offer a fresh, smarter way to invest by connecting a company’s story with financial forecasts and fair value. On Simply Wall St, millions use Narratives on the Community page to express their real perspective. They combine their future revenue, earnings, and margin assumptions with a compelling company story. Narratives empower you to judge when to buy or sell by showing if the fair value justifies the current price, and they remain dynamically up to date as news and earnings change.
See what’s driving the story and follow the original Narrative for Advanced Micro Devices here to keep up:
Get timely insights as major cloud and AI deals reshape AMD’s growth prospects and valuation.
Explore both bullish expectations and the key risks that could challenge AMD’s trajectory in a dynamic, real-world context.
Stay updated as analyst targets, news events, and financial forecasts quickly adjust the Fair Value estimate.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include AMD.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com