TLDR
- HSBC analyst Frank Lee raised AMD’s price target to a Street-high $310 from $185, implying nearly 30% upside potential
- The upgrade follows AMD’s partnership with OpenAI and plans to deploy 50,000 AI chips in Oracle’s data centers
- Lee estimates the OpenAI deal could generate approximately $80 billion in revenue by 2030
- AMD’s new MI450 AI chips are positioned to compete directly with Nvidia’s products in the data center market
- Wall Street maintains a Strong Buy consensus on AMD with 30 Buy ratings and 10 Hold ratings
AMD shares jumped over 9% on Wednesday following a major price target increase from HSBC analyst Frank Lee. The 4-star analyst raised his target to $310 from $185, establishing the highest price target on Wall Street for the chipmaker.
Lee maintained his Buy rating on the stock. He called AMD one of the strongest beneficiaries of the growing AI infrastructure boom.
The price hike follows recent news about AMD’s partnership with OpenAI. Oracle announced plans to deploy 50,000 of AMD’s AI chips in its data centers. These deals have boosted investor confidence in the company’s position in the AI infrastructure market.
Lee emphasized that AMD’s new MI450 AI chips can compete with Nvidia’s products. He projects the OpenAI deal could generate around $80 billion in revenue by 2030 if demand continues to rise.
Analyst Sees Undervalued AI Business
The HSBC analyst believes most investors underestimate AMD’s potential in the AI chip market. “We think the Street has undervalued AMD’s AI GPU business,” Lee wrote in his research note.
His revenue forecasts stand 50% higher than consensus estimates for 2026. For 2027, his projections exceed consensus by 45%.
Lee expects AMD could benefit from higher chip pricing and increased shipment volumes. He noted that AI chip demand remains in early stages and could remain strong for years to come.
Oracle Deal Details
Oracle detailed its expansion plans for AI cloud services using AMD’s Instinct MI450 Series graphics processing units. The deployment is scheduled to begin in the third quarter of next year.
The announcement came as multiple analysts raised their price targets on AMD stock. Wedbush maintained an Outperform rating and increased its target from $190 to $270.
Wall Street Consensus
AMD currently holds a Strong Buy consensus rating on Wall Street. The rating is based on 30 Buy recommendations and 10 Hold ratings.
The average price target across all analysts sits at $248.83. This represents about 4.29% upside potential from current levels.
The stock has climbed 95.7% since the beginning of the year. At $236.04 per share, AMD recently hit a new 52-week high.
Investors who purchased $1,000 worth of AMD shares five years ago would now hold an investment worth $2,839. The stock experienced 24 moves greater than 5% over the last year, indicating high volatility.
Five days before this rally, AMD shares dropped 5.9% when President Donald Trump threatened new tariffs on Chinese goods. China responded by tightening export controls on rare earth metals and launching an antimonopoly investigation into Qualcomm.
Chinese customs officials began conducting stricter checks on semiconductor shipments at ports. The escalating trade tensions created uncertainty for semiconductor companies that rely on global supply chains.
