BofA Securities increased its price objective for Advanced Micro Devices (NASDAQ:AMD) to $280 from $260 while keeping a Buy recommendation on the shares. The stock is trading at $242.11 and carries a price-to-earnings ratio of 126.66, reflecting elevated market growth expectations for the chipmaker.
The bank emphasized AMD’s emerging role as a credible merchant supplier of AI GPUs outside of Nvidia, and highlighted the company’s consistent execution in meeting and exceeding market expectations. Over the last twelve months, AMD has posted revenue growth of 31.83%, according to InvestingPro data, and retains a financial health score of 2.91, rated as "GOOD."
BofA also pointed out that ownership of AMD remains relatively low among investors, with just 2 of 10 holding positions, and that the stock is underweighted in U.S. large-cap portfolios at 0.16x relative to the S&P 500. These observations formed part of the rationale for the price-target increase and the maintained Buy rating.
The analysts acknowledged several execution risks while expressing confidence in upward estimate momentum. Specifically, BofA noted that AMD will need to demonstrate rack-scale execution in large AI clusters and that the company’s expanding exposure to OpenAI represents a concentration risk. Nonetheless, the firm expects continued growth across AMD’s CPU, GPU, and embedded segments to support higher estimates going forward. The stock’s beta is 1.95, indicating higher volatility relative to the broader market.
Following AMD’s fourth-quarter results and accompanying call, BofA raised its calendar year 2026 and 2027 earnings-per-share estimates by 3% and 9%, respectively, to $6.49 and $10.30. The bank maintained a target valuation multiple of 27x CY27E PE, which it noted compares favorably to AMD’s potential for over 50% annual EPS growth.
AMD’s most recent quarter outperformed consensus on several fronts. Revenue reached $10.3 billion with an adjusted gross margin of 57.0%, beating analyst expectations of $9.7 billion in revenue and a 54.5% margin. Adjusted earnings per share came in at $1.53 versus the anticipated $1.32. Those results prompted additional analyst reactions across the brokerage community.
In other analyst moves, Truist Securities raised its price target for AMD to $283 on a positive growth outlook. Stifel and Loop Capital both reaffirmed Buy ratings, with respective price targets of $280 and $310. Bernstein revised its target to $235, citing strong server performance and client share gains. Raymond James cut its price target to $365 but continued to carry an Outperform rating, noting concerns over GPU sales in China.
The mix of upward target adjustments and more cautious stances underscores divergent analyst perspectives even as several firms point to robust revenue and margin performance. InvestingPro also provides 18 additional investment tips on AMD and a Pro Research Report that compiles deeper analysis and data-driven insights for investors.
Overall, the BofA action raises expectations for AMD as a multi-segment growth story tied to AI demand, while also drawing attention to execution and concentration risks that could influence future results.