Why This Analyst Is Betting AMD Stock Can Hit $1,250 in the Next Year

Advanced Micro Devices (AMD) has taken the limelight this year among investors and analysts, as its AI customer base continues to grow and it gains greater visibility into its prospects. While the AI-chip space is deeply contested, with one notably big player, AMD has been gaining ground lately. 

Baird analysts have turned extremely bullish on the stock, doubling its price target from $625 to $1,250, which indicates a 139.5% upside from current levels. That’s coming after the stock has almost doubled this year. Maintaining an “Outperform” rating, Baird analysts now see AMD’s AI GPU revenue climbing to $147 billion by 2030 and its market share reaching a significant 15%. 

As already stated, AMD has gained higher visibility into its own prospects. Agentic AI, as well as next-generation AI systems, is expected to require more computing resources, prompting the company to raise its projections. At its Advancing AI event, AMD forecasted the AI accelerator market would reach $1.40 trillion by 2030, up from more than $1 trillion in its previous projection. 

On the operational side, AMD is trying to aggressively ramp up production of its products. This year, it began ramping up production of its next-generation EPYC processor (called Venice) using Taiwan Semiconductor Manufacturing Company’s (TSM) advanced 2nm process technology. AMD is also preparing to ship its first AI rack-scale system (called Helios) later this year to a select group of hyperscalers. 

We take a look at AMD at this juncture…

About AMD Stock

As one of the biggest semiconductor companies in the world, AMD designs high-performance processors and graphics chips used in PCs, gaming devices, data centers, and AI systems. AMD has become a major name in modern computing and continues to compete at the top of the tech industry. The company, headquartered in Santa Clara, California, has a market capitalization of $851.1 billion. 

AMD has rapidly become the second option for hyperscalers after Nvidia Corporation (NVDA). Although Nvidia still enjoys significant market share and pricing power in the GPU space, the second source thesis seems to be working well for AMD. For instance, Helios is the first rival to Nvidia’s Grace Blackwell and Vera Rubin infrastructure. 

This is also apparent when we see that AMD’s stock has gained 196% over the past 52 weeks, while Nvidia's has gained 13,4%. This year, as investors are keen on the company’s strong AI-related growth, especially in data center CPUs and accelerators, the stock has climbed 130.1%. AMD’s shares reached a 52-week high of $584.73 on June 30, but are down 15.4% from that level. 

The rapid surge in AMD’s stock has also resulted in an elevated valuation. On a forward-adjusted basis, its price-to-earnings (non-GAAP) ratio of 70.07 times is considerably higher than the industry average of 23.60 times. 

AMD’s Q1 Results Beat Expectations As AI Demand Boosts Outlook

AMD reported strong first-quarter results driven by demand for AI infrastructure. The company’s revenue increased by 38% year-over-year (YOY) to $10.25 billion, exceeding the $9.85 billion expected by Wall Street analysts. 

Data Center segment reported revenue of $5.80 billion, up 57% YOY, driven by strong demand for AMD EPYC processors and the continued ramp of AMD Instinct GPU shipments. The company’s non-GAAP EPS rose 43% from the prior-year period to $1.37, surpassing the $1.30 expected by Street analysts. 

For the second quarter (to be reported on Aug. 4, after the market closes), AMD expects revenue of approximately $11.20 billion, plus or minus $300 million, representing about 46% YOY growth, with non-GAAP gross margin of approximately 56%. 

Wall Street analysts are robustly optimistic about AMD’s future earnings. They expect the company’s EPS to climb by 400% YOY to $1.35 for Q2 2026. For fiscal 2026, EPS is projected to surge 91.7% annually to $6.27, followed by an 84.4% growth to $11.56 in fiscal 2027.  

What Do Analysts Think About AMD’s Stock?

In addition to the Baird price-target hike, other Wall Street analysts have also raised their price targets on AMD’s stock after its Advancing AI event. 

Analysts at Rosenblatt raised the price target from $490 to $665, while maintaining a “Buy” rating. The firm’s analysts believe that AMD’s EPYC server can deliver over 70% YOY revenue growth, with gross margin above average corporate levels. Notably, rival chipmaker Intel’s (INTC) delay in releasing its Diamond Rapids servers could also help EPYC dominate the high-end market. 

Jefferies analysts raised the price target from $515 to $640, keeping their “Buy” rating, citing the Advancing AI event that highlighted the momentum AMD is building, especially in attracting AI customers. The firm noted AMD’s ramping of Helios and Venice products, which could position AMD for further growth. 

Chip giant AMD is a widely followed name on Wall Street, with analysts awarding it a consensus “Strong Buy” rating. Of the 45 analysts rating the stock, a majority of 35 analysts have given it a “Strong Buy” rating, two analysts rated it “Moderate Buy,” while eight analysts are taking the middle-of-the-road approach with a “Hold” rating. The consensus price target of $548.71 represents a 10.9% upside from current levels.