RBC Capital Raises AMD Price Target to $400
RBC Capital analyst Srini Pajjuri raised the price target on AMD (NASDAQ: AMD) to $400.00 (from $325.00) while maintaining a Sector Perform rating.
“AMD’s results and outlook were both solid and generally consistent with our preview for 4-6% beat/raise.
As expected, server CPU revenue was particularly strong (up 50%/70%+ y/y growth in 1Q/2Q) driven by Agentic AI.
Management now sees the server CPU market growing at >35% CAGR to $120B TAM by 2030, double the prior projection.
AI GPU business is generally tracking in line, although management sounded incrementally positive about 2027.
While we remain positive on CPU growth, intensifying competition from in-house ARM-based solutions presents LT risk.
At 35x CY27EPS, we believe further outperformance will largely be a function of strong MI455/Helios ramps.
We view component supply, rack-scale execution, and competition as potential challenges and would wait for evidence of Helios volume ramps before getting more constructive.”
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