Oppenheimer upgraded Advanced Micro Devices to outperform with a $600 price target on Monday, citing AMD's AI compute partnerships, its upcoming MI500 GPU launch, and projected data center revenue growth of 135% in 2027.
Advanced Micro Devices received a vote of confidence from Oppenheimer on Monday, as the investment firm upgraded the chipmaker to outperform from market perform and assigned a $600 price target — implying 34% upside from Friday's close.
Analyst Rick Schafer made the call in a note to clients published Sunday, citing AMD's most recent earnings report and a fireside chat the firm hosted.
"We are raising estimates and upgrading shares of AMD on the heels of another bullish earnings call and recent fireside chat we hosted," Schafer wrote. "We see AMD emerging as a durable supplier of AI compute, with multi-gen customer wins and Helios rack-scale solutions supporting a materially larger [data center] business."
AMD shares had fallen more than 26% over the prior month, as investors rotated out of semiconductor and other AI-linked stocks amid concerns about financing risks across the industry. The stock rose more than 3% in premarket trading Monday following the upgrade.
Schafer pointed to several near-term catalysts underpinning the bullish outlook. AMD's strategic partnership with Anthropic is expected to gain momentum in the first quarter of 2027, while the company is also scheduled to launch its MI500 line of GPUs — targeted at high-performance computing and large-scale AI training — in the second half of 2027.
Oppenheimer models AMD achieving data center revenue growth of 135% in 2027, driven by server CPU share gains, content increases, and a shift toward a more favorable earnings mix as Client and Gaming segments contribute less to overall results.
"Annual Instinct product cadence and [AMD's open software stack] progress strengthen AMD's competitive positioning, while compute-heavy agentic AI drives incremental [graphics processing units] and … [central processing unit] demand," Schafer said.
The upgrade aligns with broader Street sentiment on the stock. Of the 56 analysts covering AMD tracked by LSEG, 48 carry a buy or strong buy rating.
Oppenheimer's call came shortly after AMD reported better-than-expected third-quarter earnings and revenue, results that Schafer cited as a primary driver of his improved outlook.
The upgrade arrives on a day when AMD's closest rival, Nvidia, faced its own headline risk — dropping nearly 5% in premarket trading after the company opened an internal investigation into CEO Jensen Huang's relationship with a businesswoman whom U.S. intelligence agencies allege is a Chinese spy. That divergence left AMD in an unusually favorable position within the semiconductor sector early Monday.
Whether AMD can convert the analyst optimism into sustained stock recovery will depend in large part on the pace at which its data center pipeline materializes — and on how the broader AI infrastructure spending environment evolves heading into 2027.
Jay Goldberg is a staff writer at TechEchelon covering technology, markets, and policy. He files the breaking news and deal coverage that move the publication's core desks.
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