From Nasdaq: 2025-01-17 00:38:27

AMD stock (NASDAQ:AMD) has dropped about 11% in the past week and is down 25% since early 2024. Analyst downgrades and competition concerns have contributed to the decline, particularly in the GPU space. However, new MI350 chips may help AMD compete better, especially in the AI market.

The AI market is shifting towards inferencing, where AMD’s AI processors could excel. Reports suggest that AMD’s MI300X is competitive with Nvidia’s H100 GPU on AI inference benchmarks, leading to significant business wins. Customers are seeking cost-effective alternatives to Nvidia, making AMD an attractive option for AI workloads.

AMD’s expertise in both CPUs and GPUs positions it uniquely as computer hardware evolves. Integrating CPU and GPU capabilities allows AMD to efficiently balance general-purpose processing with accelerated computing tasks, giving the company an edge in the PC market. The company’s annual stock returns have been volatile but remain positive, making it an attractive investment option.

Despite recent challenges, we are positive on AMD stock with an estimated price of $160 per share, 35% higher than the current market price. With a reasonable multiple of about 23x consensus 2025 earnings and projected revenue growth of 26% for 2025, AMD’s strong sales growth and prospects in the AI market make it an appealing investment opportunity. 1. The stock market surged today, with the S&P 500 hitting a record high of 4,319.94. Tech stocks led the gains, with Apple and Microsoft both reporting strong quarterly earnings. The Dow Jones also saw a significant increase, gaining over 300 points.

2. In other news, the CDC announced that fully vaccinated individuals can now go without masks in most indoor and outdoor settings. This decision comes as COVID-19 cases continue to decline in the United States, with over 50% of adults now fully vaccinated.

3. The housing market is showing signs of recovery, with home prices reaching a new high in April. The median home price rose to $341,600, a 19.1% increase from the previous year. Low mortgage rates and high demand are driving this trend, leading to a competitive market for buyers.



Read more at Nasdaq: Why AMD Stock Declined 11% Over The Past Week?