Advanced Micro Devices (NASDAQ: AMD) stock dropped 5% due to concerns about the MI450 AI chip development delay. Despite this, Wells Fargo analyst Aaron Rakers believes the sell-off is unwarranted as AMD is making progress and should begin production in the second half of the year.

Rakers remains optimistic about AMD’s potential, with a $345 price target and an overweight rating. However, with AMD’s high price-to-free cash flow and price-to-earnings ratios, the stock may still be overvalued. Analysts project 44% earnings growth annually, but current valuations suggest caution.

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Read more at Nasdaq: Why Advanced Micro Devices Stock Just Dropped