AMD Gets Stock Downgrade, Why is Wall Street Bearish?

Advanced Micro Devices (AMD) is one of the best-performing tech companies on the US stock market this year. Year-to-date, the stock is up over 37%, with August proving mixed for AMD. However, analysts on Wall Street recently gave the stock a downgrade, leaving current forecasts unchanged.

Seaport Research downgraded AMD to Neutral from Buy with no price target. Recent supply chain checks point to AMD seeing slowing growth in its AI accelerator business, the firm told investors this week. The tech company remains a key player in the data center market, but growing competition appears to be waning among Wall Street experts. Currently trading at 161.79, the stock is down 8% in the last 30 days.

AMD Still Underrated Even On Wall Street: Should You Buy?

AMD is considered the most under-owned semiconductor stock, despite outperforming the sector this year and having a strong sales growth outlook. The growing demand in the AI and data center markets is viewed as a key opportunity for AMD to rally, particularly with the introduction of products like the MI355 GPU. While it’s lower on the totem pole of semiconductor stocks, this could mean that it has great value if bullish price forecasts come true in the coming months.

Also Read: AMD Stock 10-Year Forecast: Can it Surge 30,000% Like Nvidia?

Analysts are generally optimistic about AMD, with most expecting the stock to rise above its current price of $162.13. Notably, Stifel and Raymond James have high price targets of $190 and $200, respectively. Furthermore, Bank of America Securities recently reiterated its rating, maintaining a Buy with a $200 price target. Stifel also maintained their Buy rating with a target of $190.

At press time, AMD is trading near the top of its 52-week range and above its 200-day simple moving average. The stock is rated as a 9/10 according to CNN Business and TipRanks, making it a valuable, under-the-radar investment for stock experts. With revenue continuing to rise year-over-year, the growing AI industry is expected to continue driving growth in AMD’s stock value. Out of 57 analysts surveyed by CNN, none suggest selling the stock: 70% buy and 30% hold.