Advanced Micro Devices Inc. (AMD) shares moved higher Wednesday, riding a fresh wave of enthusiasm around artificial intelligence infrastructure spending. The stock gained about 3%, outpacing the broader market, as investors continued to bet on the AI boom.
Over the past 12 months, AMD has climbed more than 179%, a staggering run that reflects the market's belief that AI will keep driving demand for high-performance chips.
Wednesday's move got a boost from some encouraging read-throughs. CoreWeave Inc. (CRWV) and Super Micro Computer Inc. (SMCI) both signaled strong AI demand, which bodes well for AMD and other chip suppliers. Meanwhile, Intel Corporation's (INTC) move to secure $20 billion in fresh capital reinforced the view that AI infrastructure spending remains robust.
While the Nasdaq Composite rose 0.71% and the S&P 500 gained 0.19%, AMD's 3% jump showed it was leading the pack.
AMD Technical Analysis
AMD remains in a long-term uptrend, but the short-term picture is a bit more mixed. The stock is trading 15.4% above its 100-day simple moving average (SMA) and 51.7% above its 200-day SMA, which are solid bullish signals. However, it's sitting 1.3% below its 20-day SMA and 4.6% below its 50-day SMA, suggesting some recent weakness.
The relative strength index (RSI) is at 48.03, which signals neutral momentum. That's not a strong buy or sell signal, just a pause.
One bearish signal: AMD's 20-day SMA is below its 50-day SMA, which is often seen as a short-term negative. If the stock can move back above those averages, it could strengthen the bullish case.
Key resistance is around $530, while support sits near $460. A break above $530 could open the door to more upside, while a drop below $460 might signal further weakness.
Analyst Outlook
Wall Street remains bullish on AMD. The stock carries a Buy consensus rating with an average price target of $591.39. Recent analyst actions have been mostly positive:
- Argus Research raised its price target to $625, maintaining a Buy rating.
- Rosenblatt maintained a Buy rating and raised its target to $700.
- JPMorgan maintained a Neutral rating but increased its target to $550.
These targets suggest analysts see significant upside from current levels, though the range of opinions shows some caution.
MarketDash Edge Rankings
AMD scores strongly on momentum, quality, and growth in the MarketDash Edge rankings. Its momentum score is 97.6, quality is 93.92, and growth is 94.02. However, its value score is just 4.65, reflecting the stock's premium valuation.
AMD trades at a price-to-earnings ratio of about 121 times, which is high by any measure. That leaves the stock sensitive to changes in growth expectations. If investors start to doubt the AI story, the stock could be vulnerable to a sharp pullback.
AMD Stock Price Action
AMD shares were up 3.04% at $488.73 at the time of publication Wednesday, according to market data.
Photo via Shutterstock
