Truist Raises AMD Price Target to $605

Truist Securities analyst William Stein raised the price target on AMD (NASDAQ: AMD) to $605 (from $594) while maintaining a Buy rating.

“AMD delivered another solid qtr, with Q3 results and Q4 guidance better than consensus. In Q3, Datacenter revenue of ~$8.5B grew ~64% y/y and beat consensus by ~5%.

Management noted the upside was driven by strong demand for EPYC processors and the launch of AMD Instinct MI450 Series GPUs.

Looking forward, AMD guided Q4 revenue to ~$17B at the midpoint, up ~65% y/y and 4% better than consensus.

Management anticipates DC revenue growing ~50% q/q in Q4, driving segment revenue ~16% above our prior model.

Margins continue to be strong, with Q3/Q4 OPM beating consensus by 130/180bps, respectively.

Finally, AMD guided 2027 revenue of up >80% y/y, better than prior consensus of ~76% y/y.

Management expects DC revenue to comprise more than 80% of total revenue in 2027, implying end market growth of +125% y/y.

Within this, AMD expects DC CPU revenue to ~double, and for AI (accelerator) revenue to more than double.

Impressively, management is targeting 2027 OpEx growth less than half the rate of revenue growth, implying substantial operating and earnings leverage.”

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