Advanced Micro Devices Inc. (NASDAQ:AMD) CEO Lisa Su expects chip demand to stay “very high” for the next several years. On October 6, speaking to reporters in Taipei, she said demand is still running ahead of supply, even as AMD ramps up output. Su said AMD increased supply through 2026 and plans a much bigger jump in 2027. Her trip included meetings with Foxconn and a meeting with TSMC, followed by talks with memory makers in South Korea. She added that AMD now plans its capacity three to five years ahead. Lisa Su sees years of strong chip demand ahead, but where are billionaires placing their bets on the next wave of growth? These 10 stocks are worth a closer look.
Why Supply Is the Number I’m Watching
For AMD right now, supply remains the number that matters most. When customers want more chips than you can make, every extra wafer you secure turns into revenue. Su’s comments also match what Stifel said on October 5, when it raised its AMD target to $700. The firm argued AI buildouts are limited by chip supply. I like that AMD is planning in capacity years ahead, since TSMC’s advanced production is where the bottleneck sits. Memory is the other piece, which explains the stop in South Korea. AI chips need large amounts of it, and AMD can only ship as many as its memory supply allows. AMD’s AI opportunity is attracting attention, but there’s another angle investors shouldn’t miss: Could Meta eventually acquire 160 million AMD shares for just one cent each, and what conditions stand in the way?
The Valuation Needs That Supply to Come Through
AMD isn’t cheap by any measure. Both the forward non-GAAP P/E of 83.38x and forward Price-to-sales ratio of 20.25x sit at more than double their 5-year averages. Investors are paying a steep premium for the growth ahead. Analysts expect EPS to rise about 82% in 2026, 107% in 2027, then 45% in 2028. Based on 2027 earnings, the P/E falls to about 40x, and to roughly 28x by 2028. That 2027 jump lines up with the supply increase Su is promising. The balance sheet is also strong. AMD held approximately $9.9 billion more in cash and short-term investments than total debt at the end of Q2 2026. Still, I believe the premium only holds up if the extra wafers and memory arrive on time.
Hedge funds have been piling in. Funds holding AMD rose from 134 in Q1 to 164 in Q2. The value of their stakes rose much more sharply, going from $8.7 billion to $23.6 billion.
Su’s comments suggest demand won’t be AMD’s problem. The question is whether it can build enough chips to meet it. If it can, earnings growth could bring the valuation multiple down, although investors still face execution risk at today’s premium.
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