The recent pullback has renewed buying interest in AMD, with the stock down 11% from last Tuesday’s record high.
- AMD stock rose 2.6% in premarket; it’s up 142% year to date.
- Analysts on average forecast a 2% downside in the stock.
- Stocktwits sentiment for AMD dipped to ‘neutral’ from ‘bullish.’
Advanced Micro Devices shares rose 2.6% in premarket trading on Monday, rebounding from last week’s decline as retail traders speculated that the renewed momentum could propel the stock to the $600 mark for the first time.
The stock was trending at the top on Stocktwits as premarket trading kicked off, although the retail sentiment dipped to ‘neutral’ from ‘bullish.’
“$AMD buyers seem to be supporting the price very strongly tonight, not allowing any dip to go too far. This could make a massive move tomorrow and force shorts to cover in deep red positions. Let’s see what the morning brings but not looking good for shortie,” a trader wrote.
Another said the stock “may hit 600 before open tomorrow!”
“Foxconn’s strong June revenue growth highlights continued strength in global electronics and AI-related supply chains, reflecting ongoing demand for servers, GPUs, and data center infrastructure,” a trader said, referring to Foxconn’s June results issued on Sunday.
AMD’s Dip Piques Interest
Buying interest in AMD picked up following the recent pullback. The stock fell over Wednesday and Thursday, with U.S. markets closed on Friday for the Independence Day holiday, leaving the shares about 11% below their record high reached last Tuesday.
AMD stock is up 142% year-to-date, on track for its best annual performance since 2016. In comparison, peer stocks Nvidia and Intel have gained 4.6% and 226% respectively in this period, while the chips benchmark, iShares Semiconductor ETF (SOXX) is up 88%.
AMD Analyst View
Last week, Wells Fargo and Cantor Fitzgerald raised their price targets on the stock, citing strong CPU demand for AI data centers.
The AI infrastructure buildout is viewed as a generational semiconductor cycle that is both durable and extended by supply chain constraints, with expectations for faster-than-previously-forecast industry revenue expansion reaching roughly $3 trillion by 2029 and potentially exceeding $3.5 trillion by 2030, Cantor Fitzgerald said in its investor note.
Still, analysts’ price targets suggest they expect limited medium-term upside in the stock. Although 42 of 51 brokerages recommend ‘Buy’ or higher, their average price target of $517.81 is 2% below AMD’s closing price on Thursday.
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