AMD’s Upcoming Catalyst: Will the Stock Rally Again?
Big Event on the Horizon
Advanced Micro Devices Inc. (AMD) is gearing up for a significant catalyst that could put its stock price on the fast track, much like last year’s Advancing AI event. This Thursday, AMD is expected to reveal a slew of product announcements, specifically concerning its new MI325X artificial-intelligence accelerator, along with updates related to their central processing units (CPUs) and graphics processing units (GPUs). With heightened anticipation among investors, the key question looms: Can AMD deliver the goods and propel its stock price higher once again?
Last Year’s Impact
Last year’s Advancing AI event proved to be a game-changer for AMD, sending shares soaring by 10% in the session following the event. In fact, through the rest of the year, AMD outperformed Nvidia Corp. shares (NVDA) and the broader PHLX Semiconductor Index (SOX). According to Cantor Fitzgerald’s C.J. Muse, this year the expectations are higher. “AMD will need to provide greater confidence in the company’s technology roadmap,” he states, emphasizing the importance of securing inference design wins with a broader array of customers—a challenge that could define this year’s outcome.
The Speculation Is Thick
There’s buzz in the air that major players like Amazon Inc. (AMZN) or Alphabet Inc. (GOOG, GOOGL) could take the stage during the event. Muse points out that if management makes a great impression here, there could very well be an “outperformance into the day” and perhaps even extending into 2025. Compare this with AMD’s sluggish performance so far this year—up only 15% compared to Nvidia’s monumental 155% rise and the semiconductor sector’s 24% rally—and you’re staring down a potentially explosive scenario.
What Investors Are Watching For
Investors are keeping a keen eye on any figures shared by AMD management. One of the most anticipated announcements is an updated estimate for the company’s total addressable market in AI extending out to 2030. However, they’re also looking for more immediate insights. Muse suggests that confidence in AI GPU revenues could resonate strongly, particularly if AMD can project revenues exceeding $12 billion by calendar 2025. Achieving this could bolster earnings significantly, with estimates suggesting earnings power could approach $6—or a stock price nearing $200.
Reitzes’ Insights
Melius Research’s Ben Reitzes notes that this year’s event arrives “a little earlier than last year,” which could set the stage for more timely announcements. Reitzes and his team expect a well-rounded presentation covering AMD’s AI exposure across PCs, x86 servers, and GPUs. He advises investors to pay special attention to the Turin server announcements as they could represent a pivotal moment for AMD, directly impacting Intel Corp. (INTC) by stealing market share.
Final Thoughts
As we prepare for Thursday’s event, AMD’s trajectory is on the table. With a historical context showcasing strong rally potentials post-event, the stakes are elevated. Investors are keenly aware of the need for AMD to leverage its technological advancements to re-establish confidence after lagging behind Nvidia and the semiconductor sector in terms of stock performance.
AMD’s event isn’t just a formality; it’s a crossroads that could dictate the future momentum of the stock. With tests of their AI capabilities and strategic partnerships looming, this is a pivotal moment for AMD. Stay alert, traders—this is shaping up to be the kind of opportunity you can’t afford to miss!
