GuruFocusGuruFocus

Advanced Micro Devices Gets Price Target Hike From BofA After OpenAI Partnership

Menos de 1 minuto de leitura

Advanced Micro Devices (AMD, Financials) received a major vote of confidence from Bank of America, which raised its price target by $50 to $300 and reiterated a Buy rating. The brokerage cited AMD's growing AI presence and its new partnership with OpenAI as key catalysts for long-term growth.

BofA analysts now estimate AMD could supply roughly half of OpenAI's planned 6-gigawatt GPU rollout over the next four years, starting in late 2026. That contribution could generate about $1.4 billion in new revenue in 2026 and nearly $9.7 billion in 2027, potentially pushing earnings per share to $10$11 by 2027 if the agreement scales as expected.

The deal marks a significant milestone for AMD's AI business, potentially boosting its AI accelerator market share to around 7.5%, up from the current 34%. The company's upcoming MI450 Helios rack systemsset for release in the second half of 2026are already attracting customers such as Oracle (ORCL, Financials), Meta Platforms (META, Financials), and OpenAI.

BofA said AMD's role in open-standard AI networking makes it a growing competitor to Nvidia (NVDA, Financials) and Broadcom (AVGO, Financials), both of which are also tied to OpenAI's massive computing expansion project.

While execution risks and pricing pressures remain, analysts see the deal as a major opportunity for AMD to gain ground in the booming AI chip market.