AMD shares rebound strongly, price target raised to $175

After experiencing a nearly 20% drop in its stock price in the first four months of 2025, Advanced Micro Devices (AMD) is experiencing a strong recovery. Recently, Melius Research upgraded AMD's rating from "hold" to "buy", and significantly increased its target price from $110 to $175, pushing AMD's stock price up 11.5% in five trading days to close at $129.58. The agency predicts that with the launch of the MI400 series GPU in 2026 and the surge in demand for AI inference, AMD's earnings per share are expected to exceed $8 within two years.

Technological breakthroughs have become the core driving force of the rebound. At the Advancing AI event earlier this month, CEO Lisa Su announced that the performance of the MI350 chip surpassed Nvidia's similar products, and raised the global AI accelerator market size forecast for 2028 from $500 billion to $800 billion. This declaration quickly received a capital response: Ark Invest, owned by star fund manager Cathie Wood, spent $37 million last week to increase its holdings by more than 285,000 shares, reversing the high-level reduction at the beginning of the year.

Fundamental data also provide strong support. Despite facing a loss of $800 million due to US export controls, AMD still delivered a brilliant financial report in the first quarter with revenue of $7.44 billion and a year-on-year surge of 57% in data center business, exceeding market expectations. Even more eye-catching is its global layout - a five-year $10 billion infrastructure agreement signed with Saudi artificial intelligence company Humain, marking a strategic breakthrough in the Middle East market. Analysts pointed out that although AMD's current 7.3% year-to-date increase lags behind the Nasdaq index, the proportion of institutional holdings has rebounded to 62%, and short positions have fallen to a two-year low, with the technical side showing a "golden cross" bullish signal.