Wolfe Research analyst Chris Caso upgraded Advanced Micro Devices (AMD) stock to a “Buy” rating from “Hold” and assigned a Street-high price target of $300, implying 38.6% upside potential from current levels. The upgrade was part of a semiconductor sector preview ahead of third-quarter results.
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Caso is a five-star analyst on TipRanks, ranking #137 out of 10,081 analysts tracked. He boasts a 62% success rate and an impressive average return per rating of 24.70%.
AMD-OpenAI Deal Unlocks Massive Potential
Caso highlighted AMD’s multibillion-dollar, multi-year chip deal with artificial intelligence (AI) startup OpenAI as the primary reason for the upgrade. Under the deal, AMD will supply its upcoming MI450 AI chips to the ChatGPT maker, beginning next year. Caso expects the deal to provide a significant financial boost and drive strong demand for traditional servers.
He forecasts $15 billion in annual revenue from OpenAI and a total of $27 billion in AI-related sales by calendar year 2027. This translates to a “conservative path to $10+ earnings power” for AMD in CY27. Caso concluded that AMD simply needs to deliver on this deal to drive the stock to $300. He also expects higher upside going forward if momentum continues post-OpenAI.
Caso Revises AMD’s Forecasts
The analyst raised his server CPU revenue forecasts following management’s indication that rising agentic AI demand was driving orders for Turin and Venice chips among hyperscale and enterprise clients. Caso now projects server CPU revenue at $9.55 billion for 2025 and $11.4 billion for 2026, both slightly above earlier estimates.
The OpenAI partnership is expected to begin contributing in late 2026 as MI450 production scales. Caso forecasts $4.5 billion in server GPU revenue for 4Q26, advancing steeply in 2027 when GPU revenue is projected to reach $27.5 billion.
Is AMD Stock a Buy, Hold, or Sell?
Analysts remain divided on AMD’s long-term outlook. On TipRanks, AMD stock has a Moderate Buy consensus rating based on 28 Buys and 10 Hold ratings. The average Advanced Micro Devices price target of $243.29 implies 12.4% upside potential from current levels. Year-to-date, AMD stock has surged over 79%.
