Analysts turn heads with AMD stock forecast after massive rally
Shares of Advanced Micro Devices (AMD) are up 112.5% year-to-date, with the majority of the gains achieved in recent weeks.
From March 31 through May 8, AMD shares jumped 123.76%, according to Morningstar data, as Wall Street grew more optimistic about the company's position in the AI infrastructure market and its ability to gain share in both GPUs and CPUs.
AMD was founded in 1969 by eight men, led by Jerry Sanders, the former Fairchild Semiconductor executive. Fairchild Semiconductor shares credit with Texas Instruments Incorporated for the invention of the integrated circuit.
Decades later, AMD has emerged as one of only a few companies capable of competing at the highest end of the semiconductor industry.
Today, AMD's biggest rivals are Nvidia (NVDA) in graphics processing units, or GPUs, used to power AI data centers, and Intel (INTC) in central processing units, or CPUs.
Investors have recently become more bullish on AMD as demand for AI computing continues to surge. Wall Street analysts are actively revising their target prices for the stock.
AMD shares jump after reporting rosy earnings
AMD still trails rival Nvidia in GPUs used to power AI data centers. But AMD has long been a major player in CPUs, a market that is seeing renewed demand as agentic AI changes computing needs.
On May 5, AMD reported upbeat first-quarter results and outlook, and its shares jumped 18.61% on the following trading day.
The company posted adjusted earnings of $1.37 per share, beating expectations of $1.29 per share. Revenue rose 38% year over year to $10.25 billion, above analysts' estimates of $9.89 billion, while data center revenue climbed 57% to $5.8 billion.
For the second quarter, AMD said it expects revenue of about $11.2 billion, above analysts' estimates of $10.52 billion, according to LSEG data pulled by CNBC.
AMD CEO Lisa Su said in a statement that the data center business is now the "primary driver of our revenue and earnings growth."
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"We are seeing strong momentum as inferencing and agentic AI drive increasing demand for high-performance CPUs and accelerators," Su said. "Looking ahead, we expect server growth to accelerate meaningfully as we scale supply to meet demand."
Su said AMD has "strong and increasing confidence" in its ability to reach tens of billions of dollars in data center AI revenue next year, CNBC reported.
The semiconductor industry has been dealing with a global memory shortage due to booming AI demand, limited manufacturing, and supply chain disruptions tied to the war in Iran. That has fueled a rally in semiconductor stocks and prompted analysts to rethink price targets for several chipmakers.
Analysts raise AMD stock targets after earnings
Wedbush analysts led by Matt Bryson raised their price target on AMD stock to $450 and reiterated an outperform rating after the earnings report, according to a note sent to TheStreet.
The analysts said AMD's accelerating growth is being driven by both higher unit sales and pricing, with stronger demand tied to compute racks used for agentic AI.
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They added that AMD's management expects the trend to continue supporting its server CPU business through 2026 and 2027.
Wedbush also said AMD's data center GPU business appeared stronger than previously expected, even though CPUs drew most of the investor attention after the report.
"While CPUs stole the headlines, data center GPU demand also appeared to exceed our prior expectations," the analysts wrote.
Wedbush said AMD's management is confident about a stronger second-half ramp for its MI450 and MI455 chips, but the analysts are not fully convinced by management's outlook for GPUs, though it noted that strong CPU demand could help offset any slower-than-expected GPU ramp.
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"We've struggled somewhat to independently corroborate management's 2H outlook; however, we see strength in CPUs as offering a bit of insurance (given the ability to potentially reallocate supply) if GPUs ramp somewhat behind current expectations," the analysts wrote.
Meanwhile, Citi analysts led by Atif Malik raised their AMD price target to $358 while keeping a neutral rating on the stock.
The analysts said they remain positive on AMD's CPU opportunity, but are still waiting to see how the company's next-generation GPU products, including MI450 and Helios racks, perform after launch.
"While we are constructive on AMD's CPU opportunity on agentic AI demand, we await the release and success of its next gen GPU product MI450 and Helios racks," Citi wrote, adding that AMD is expected to significantly ramp GPU sales in the second half of 2026.
"We also expect the company to have an aggressive ramp of GPU sales in 2H26," the analysts said.
Shares of AMD closed at $455.19 on May 8, already moving above two analysts' price targets.
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This story was originally published May 9, 2026 at 11:47 AM.