AMD Stock: Top Analyst See AMD Overtaking Nvidia in the Chip Race – Here’s Why

TLDR

• Citi analyst Christopher Danely identified AMD as having the strongest momentum among chip stocks following its recent analyst event, based on expectations for higher earnings-per-share growth through 2027
• AMD is becoming more preferred by investors than Nvidia as the AI chip leader’s earnings growth begins to moderate after nearly two years of dominance
• TD Cowen analyst Joshua Buchalter maintained a Buy rating on AMD with a $290 price target, noting the company’s $1 trillion AI addressable market opportunity
• AMD’s management confirmed the EPS target of over $20 factors in full share dilution from the OpenAI deal (160 million shares) but excludes further dilution
• Wall Street maintains a Moderate Buy consensus on AMD with an average price target of $281.78, representing 22.4% upside potential

Advanced Micro Devices drew the most investor attention this week. Citi analyst Christopher Danely told clients that AMD showed the strongest momentum among chipmakers following its recent analyst event.

Advanced Micro Devices, Inc., AMD

The shift in sentiment reflects changing dynamics in the semiconductor space. Investors favored AMD based on expectations for higher earnings-per-share growth heading into calendar 2027.

Danely said updated revenue and margin targets helped reinforce confidence in AMD’s long-term outlook. The analyst’s note highlighted how investor preferences are evolving in the chip sector.

Nvidia has dominated the AI trade for nearly two years. But Danely noted that conversations suggested the stock was becoming less preferred than AMD or Broadcom as its earnings growth moderates.

The change represents a notable shift in the AI chip landscape. Broadcom remained a major position for many portfolios, though some investors raised concerns about limited visibility on potential upside tied to merchant tensor processing units.

Danely said sentiment toward Broadcom may shift once the company releases results next month. Intel also drew renewed interest as investors weighed speculation around its foundry strategy and signs of improvement in its server CPU business.

TD Cowen Maintains Bullish Stance

TD Cowen analyst Joshua Buchalter reaffirmed a Buy rating on AMD stock with a price target of $290. The five-star analyst made the call following an investor meeting with AMD’s CFO Jean Hu and CVP of Financial Strategy Matt Ramsay.

Buchalter stated that while AMD still has much to prove as it scales up its AI business, he remains constructive on the company’s ability to capture value in the growing AI market. The analyst discussed several aspects highlighted by management during AMD’s Financial Analyst Day.

Management emphasized a $1 trillion AI addressable market covering GPUs, CPUs, and server-side networking. Buchalter believes this figure includes a small amount of China opportunity.

The analyst thinks AMD’s revenue targets do not include the China business due to geopolitical uncertainty. Management outlined expectations for over 60% compound annual growth rate in the data center business.

Earnings Targets and Strategic Initiatives

AMD’s management clarified that the earnings per share target of over $20 already factors in full share dilution from the OpenAI deal. This accounts for approximately 160 million shares but does not consider any further dilution.

TD Cowen’s long-term model indicates potential earnings of more than $14 in 2028. The firm projects earnings exceeding $24 in 2030.

Regarding concerns about expanding to rack scale, management stated the chipmaker is taking several steps to reduce risks for the Helios ramp in the second half of 2026. AMD held intensive talks with suppliers and customers and tested components in detail.

The company shifted to double-wide racks to improve design, signal quality, and serviceability for both Helios and denser racks. Management noted strong progress on AMD’s ROCm software, which is expected to deliver a 10x jump in performance from MI355 to Helios alone.

Wall Street currently has a Moderate Buy consensus rating on AMD stock based on 27 Buys and 10 Holds. The average price target of $281.78 indicates 22.4% upside potential from current levels, with AMD stock rallying about 91% year-to-date.

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