Jim Cramer Says Advanced Micro’s New Long-Term Financial Targets “Were Much Higher Than Anybody Was Expecting”

Advanced Micro Devices, Inc. (NASDAQ:AMD) is one of the stocks Jim Cramer mentioned in his latest comments. Cramer highlighted the company’s recent analyst meeting and commented:

“They held an important analyst meeting… The biggest news last night was AMD’s new long-term financial targets, targets that were, they blew your mind. They were much higher than anybody was expecting, and that’s really what sent the stock into the stratosphere today. The targets… Management offered some remarkable growth targets for the next three to five years… Still, can AMD stock keep running? For the past couple of weeks, I’ve noticed that there’s been a shift in Wall Street sentiment.

Investors have gotten more discriminating when it comes to the AI stocks, with more focus on who actually has the ability to deliver on their grand promises, means making money, which brings me back to the financial projections from AMD. These numbers are to some degree an extension of the OpenAI partnership that the company announced a month ago. At the same time, we didn’t have many specifics about what this would mean for AMD sales. Now, we kind of do along with some bullish new information on margins and profits. But all of these long-term targets are contingent on AMD doing a lot of business with OpenAI starting next year.

If you believe OpenAI will honor all of its commitments or can honor all of its commitments that it’s made, the numbers are doable. If you don’t believe it, though, then the numbers become, let’s say, very stretched goals. Here’s the bottom line: Going forward, the story of AMD is all about execution. The stock’s already roared in anticipation of phenomenal growth in the data center. Now, AMD needs to actually deliver. I think Lisa Su and her team deserve the benefit of the doubt because historically they’ve done a great job, but it’s still something we need to keep an eye on. That said, given her multiple years of success at AMD, I am more than comfortable telling you that even up here, you can buy her stock.”

Advanced Micro Devices, Inc. (NASDAQ:AMD) makes processors, graphics cards, and AI chips for computers, servers, and gaming systems. The company’s products include Ryzen, Radeon, and EPYC.

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Disclosure: None. This article is originally published at Insider Monkey.