Advanced Micro Devices (AMD) stock is notably lower Wednesday after financial services firm HSBC downgraded the chipmaker to Reduce (equivalent to a Sell) from Buy and slashed its price target to $110 from $200. The new price target is more than 10% below where AMD is currently trading.
The tech stock has been flat so far in 2025 after declining more than 18% in 2024. HSBC analyst Frank Lee is concerned about AMD's ability to penetrate the artificial intelligence (AI) graphics processing unit (GPU) market and compete with Nvidia (NVDA), according to Investing.com.
"We believe AMD wouldn't be able to penetrate the AI GPU market as much as we had earlier anticipated," Lee stated.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Lee also cited concerns around AMD's client momentum and non-AI data center revenue.
"AMD's share price has corrected by 24% in the past three months but we believe there remains further downside," Lee stated.
Where does Advanced Micro Devices stand with the rest of Wall Street?
Despite Advanced Micro Devices' recent troubles on the price charts, the majority of Wall Street remains bullish on the semiconductor stock.
According to S&P Global Market Intelligence, the average analyst target price for AMD stock is $180.32, representing implied upside of nearly 50% to current levels. Additionally, the consensus recommendation is Buy.
Financial services firm Mizuho is one of the bullish firms on the large-cap stock with an Outperform rating (equivalent to a Buy) and a $180 price target.
"We see AMD still in the early innings of its AI GPU ramp and well-positioned to gain share, while personal computer looks strong despite typical March quarter seasonality," wrote Mizuho analyst Vijay Rakesh in a December 5 note.
Financial services firm BofA Securities, meanwhile, has a Neutral rating (equivalent to a Hold) on AMD stock with a $155 price target.
The company serves a vast addressable market opportunity "in PC, server, high-end gaming, deep-learning and related markets where AMD has less than 30% value share currently," wrote BofA Securities analyst Vivek Arya in a December 9 note.
The analyst expects this to grow strongly over the next few years, but notes that "AMD's data center accelerator products remain 1+ year behind the leader's roadmap and face increasing competitive threats from custom silicon at cloud customers, posing a headwind to future share gains."
Related Content
-
Is Mint Mobile's Home Internet a Game-Changer or Just Another Option?Mint Mobile recently unveiled its new home internet service. We break down how it works so you can determine if it's a great value for your needs.
-
How to Add Your Driver’s License or State ID to Google WalletStore and use your digital ID securely on your Android device for TSA, age verification and more.
-
Five Downsides of Dividend Investing for Retirees, From a Financial PlannerCan you rely on dividend-paying stocks for retirement income? You'd have to be extremely wealthy — and even then, the downsides could be considerable.
-
Dow, S&P 500 Slip on December Rate Cut Worries, Nvidia Boosts Nasdaq: Stock Market TodayNvidia became the first company ever to boast a $5 trillion market cap, but it wasn't enough to lift the Dow and the S&P 500.
-
I'm a CPA: Control These Three Levers to Keep Your Retirement on TrackThink of investing in terms of time, savings and risk. By carefully monitoring all three, you'll keep your retirement plans heading in the right direction.
-
Stocks Hit Fresh Highs Ahead of the Fed As Earnings Pump Optimism: Stock Market TodaySHW and UNH were two of the best Dow Jones stocks Tuesday, thanks to solid earnings reports, and MSFT closed with a $4 trillion market cap.
-
Targa Resources, Take-Two Interactive, Boston Scientific: Why Experts Rate These Stocks at Strong BuyWall Street is highly bullish on these three high-quality stocks.
-
Debunking Three Myths About Defined Outcome ETFs (aka Buffered ETFs)Defined outcome ETFs offer a middle ground between traditional equity and fixed-income investments, helping provide downside protection and upside participation.
-
This Is Why Judge Judy Says Details Are Important in Contracts: This Contract Had HolesA couple's disastrous experience with reclaimed wood flooring led to safety hazards and a lesson in the critical importance of detailed contracts.
-
US-China Trade Hopes Send Stocks to New Highs: Stock Market TodayApple and Microsoft are on track to join Nvidia in the $4 trillion market cap club.
