Advanced Micro Devices, Inc. (NASDAQ:AMD) has emerged as a standout in the realm of top AI stocks to watch in recent times. On October 10, investment firm TD Cowen maintained its “Buy” recommendation, raising the price target for AMD to $270 from a previous $195.
The firm anticipates substantial growth potential stemming from AMD’s collaboration with OpenAI.
“We are neutral ahead of the print on AMD (Buy): Although a positive outcome is expected, following a significant surge of 64% in shares after the landmark deal with OpenAI, and with the upcoming analyst day on 11/11, we feel the anticipated beat/raise might not serve as a considerable catalyst.”
A recent agreement with OpenAI enables the company to acquire billions in equipment to enhance its AI capabilities, potentially taking a 10% stake in AMD in return.
“While the formal partnership was somewhat anticipated given Sam Altman’s presence at AMD’s AI event, and considering OpenAI’s ongoing demand for computational resources, the scale and depth of this deal came as a surprise. There is still much to demonstrate with actual deployments; however, we believe this alleviates several investor concerns related to AMD’s growth trajectory,” said Analyst Joshua Buchalter. “Overall, we think the partnership validates AMD’s significant role in the expanding AI compute total addressable market (TAM), alongside NVIDIA.”
Advanced Micro Devices, Inc. (NASDAQ:AMD) specializes in developing and supplying semiconductors, processors, and GPUs aimed at data centers, gaming, AI, and embedded applications.
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