Advanced Micro Devices (AMD) shares climbed nearly 9% on Monday after analysts at Piper Sandler raised their price target, citing strong optimism following the company’s latest product announcements. The rally brought AMD stock to its highest level since early January.
Analysts See AI Products Driving Growth
Piper Sandler analysts highlighted the potential for a rebound in AMD’s graphics processing unit (GPU) business during the fourth quarter. By that time, the company is expected to work through most of the $800 million in charges linked to new U.S. export restrictions on semiconductor sales to China and other countries.
Next-Generation AI Chips Unveiled
Last week, AMD introduced its next-generation Instinct MI400 series of AI chips. Among the highlights was the debut of Helios, a full-server rack designed to connect thousands of AMD chips. The system targets AI customers such as cloud service providers and developers of large language models. OpenAI CEO Sam Altman, who appeared on stage with AMD CEO Lisa Su at the San Jose launch event, called the new system “totally crazy.”
Price Target Raised Amid Growing Confidence
Following the product launch, Piper Sandler increased its price target for AMD shares from $125 to $140, reflecting confidence in the company’s AI-driven growth prospects. “We are enthused with the product launches at the AMD event this week, specifically the Helios rack, which we think is pivotal for AMD Instinct growth,” the analysts wrote in their note.
Stock Reaches New 2024 High
AMD shares rose above $126 on Monday, closing at their highest level since January 7. The stock had previously faced pressure following President Donald Trump’s announcement of new tariffs and AMD’s disclosure of the expected charges related to chip export controls.
AMD’s successful unveiling of its advanced AI hardware has renewed investor optimism about its growth trajectory. As the company navigates export restrictions and expanding AI demand, analysts see the latest product launches as key drivers for its long-term performance.
