AMD Rises 5.86% After Bank of America Raises Target to $700
The stock's target price was increased amid growing demand for chips.
AMD shares ended the session up 5.86%. Bank of America raised the target price from $650 to $700, linking the decision to increased demand for chips.
An additional factor was the actions of other analysts. William Blair also upgraded AMD’s rating, expecting that uncertainty around Nvidia would help the company increase its market share. This uncertainty grew after the unexpected resignation of Nvidia CEO Jensen Huang.
Positive expectations are not only tied to the competitor’s situation. In AMD’s third-quarter report, revenue from the data center division grew by 97% year-over-year. The company expects server revenue to double by 2027.
At the same time, analytical recommendations come with high stock valuations: the source cites P/E ratios of 127 and 72 for projected earnings. This may limit the perception of the target price increase as an unambiguous buy signal.
