AMD Gets a $140 Target From Goldman—but Faces Headwinds in AI Race

Advanced Micro Devices, Inc. (NASDAQ:AMD) is one of the Trending AI Stocks on Wall Street. On July 10, Goldman Sachs analyst James Schneider initiated coverage on the stock with a “Neutral” rating and a price target of $140.

The investment bank initiated the U.S. digital semiconductor and electronic design automation software group, highlighting that it is most constructive on merchant silicon and EDA vendors tied to artificial intelligence-related capital spending.

“We believe the AI investment cycle is in a state of transition, with over $350bn in CapEx spent on AI infrastructure,” he said. “Although monetization has been elusive, we see early signs of incremental revenue and much clearer evidence of cost takeout to justify these investments — and we believe AI CapEx can sustain growth from current levels.”

A business executive in a modern office looking over reports detailing artificial intelligence.

Particularly for AMD, the firm noted that it is a fabless provider of X86-based Server and PC CPUs, custom SoCs, and merchant GPUs. The company has been performing well and has also gained significant market share in the X86 Server CPU and PC CPU markets.

Since ARM-based solutions are gaining traction, the firm anticipates AMD’s share gains in the Server CPU market to slow down. Meanwhile, AMD’s merchant GPU solutions are likely to gain limited market share against Nvidia.

Advanced Micro Devices, Inc. (NASDAQ:AMD) develops and sells semiconductors, processors, and GPUs for data centers, gaming, AI, and embedded applications.

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