New Street upgrades AMD on AI chip spending growth

New Street upgraded AMD (AMD) to Buy from Neutral with a $215 price target after analyzing the possibility of $400B being spent on artificial intelligence chips in 2027. AMD is the best way to play a fast adoption scenario of AI chips, with the most valuation and expectation upside, the analyst tells investors in a research note. The firm says TSMC (TSM) is the “most de-risked play,” offering limited market share uncertainty, upside to expectations, and attractive valuation in both a fast and a slow adoption scenario. New Street believes AMD’s multiple will normalize towards 30-times as its growth slows, implying a $215 share price in 12 months, or 26% upside. The stock in after-hours trading is up 1% to $169.70.