Here’s Our AMD Price Target as Top-Ranked Analyst Upgrades Stock
Amid the SpaceX hoopla, you may missed two of Wall Street’s best weighing in on the chip name. Plus, what to watch on the chart.
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Advanced Micro Devices (AMD) may not be top of the news Friday as SpaceX (SPCX) goes public and peace talks progress between the U.S. and Iran. AMD was not top of mind even in the semiconductor space on Thursday either, as shares of Intel (INTC) benefited from a double upgrade by highly regarded Bank of America analyst Vivek Arya. That said, Intel was not the only semi stock that Arya had something nice to say about on Thursday.
On Thursday, Arya, who is rated at five stars out of five by TipRanks, reiterated his “buy” rating on AMD while increasing his price target to $560 from $500. Over the past two years, Arya has had a 63% success rate and produced a 49.1% average return. This (Friday) morning, Citigroup analyst Atif Malik upgraded AMD to a “buy” rating from “neutral.” Malik also increased his price target, to $575 from $460.
Malik believes that AMD’s graphics processing unit upside is not quite fully priced into the shares. He sees AMD “as a legit second source” in that market. Malik also sees the company as being well-positioned to win the “lion’s share” of the business at Meta Platforms (META). He believes that AMD is still viewed as a CPU stock, which creates upside potential for valuation expansion.
How have Malik’s picks performed in the past? Simply put, he’s one of the very best. He’s not just a five-star analyst at TipRanks, that service ranks him as the very best analyst on Wall Street out of 12,293 individuals. Over the past two years, Malik has an 89% success rate and has produced an average return of 107.2%.
The Chart
About 10 days ago, I warned readers that while long AMD, the stock could hit a bump in the road. It did. AMD broke out sharply in April from a basing pattern of consolidation that ran from late October into late April. The shares obliterated what was then my temporary price target of $456 as May wore on. We sold a small amount at that time. The shares then developed a rising wedge pattern of bearish reversal. That selloff was triggered on June 4.
Now, with these upgrades and reiterations, AMD has rallied out of that selloff, breaking what could have wound up looking like a head-and-shoulders pattern, which would be bearish. I believe that swing traders defended the stock at its 21-day exponential moving average (EMA), which matters.
Relative Strength is on the mend, but the daily moving average convergence divergence (MACD) is still looking negative. This will have to be watched over the coming days.
I am reiterating my $588 price target, with an upside bias.
At the time of publication, Guilfoyle was long AMD and INTC equity.
