Advanced Micro Devices
received some approving nods from Wall Street on the heels of its artificial intelligence event, thanks in particular to interest from tech giants like
Microsoft
and
Meta Platforms.
But it’s no
Nvidia,
yet.
AMD stock rose 8.5% to $126.70 on Thursday, making it the leading performer in the
S&P 500.
This year, shares have soared 96%, putting them on track for their best year since 2020, according to Dow Jones Market Data.
On Wednesday, the chip maker said its Instinct MI300X accelerators were available for sale to data-center customers and server makers and also launched a new lineup of laptop processors. The company also said its latest MI300X products can outperform the Nvidia H100 HGX server platform by up to 60% for certain AI model inference workloads.
That apparently has caught the attention of some industry titans. According to a news release from AMD,
Microsoft,
Meta, and
Oracle
have adopted or are in the process of adopting the MI300X accelerators, which left Wall Street tentatively optimistic.
“AMD knows that promoting a whole ecosystem from software to networking is the key to success—which Nvidia has proven,” Melius Research analysts wrote Wednesday. “While we don’t expect AMD to ever see the support of Nvidia’s CUDA, the improvements bode well for scaling at some of these large customers in 2024.” CUDA is Nvidia’s proprietary computer application. Melius rates AMD at Hold with a price target of $125.
Raymond James analysts cheered even louder. In a report Wednesday, the team cited positive commentary from Meta around the MI300X, adding that high margins at Nvidia allow AMD the space to price its accelerators ”aggressively.” Raymond also says AMD can snap up additional market share in the generative AI market, which would boost growth and margin expansion over the next two to three years. They rate shares at Strong Buy and lifted their price target to $140 from $125.
And finally, Oppenheimer analysts, who rate shares at Perform, also applauded the developments, but more cautiously.
“We commend AMD’s efforts as they bear fruit,” they wrote on Wednesday. “We continue to view NVDA as the dominant accelerator franchise and remain sidelined as AMD’s AI vision proves out.”
Write to Emily Dattilo at [email protected]
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