Cantor Fitzgerald Maintains AMD Stock Price Target at $200

In the constantly changing life of semiconductors, it seems like AMD appears to have discovered the ideal mix. In this recipe for tech, if the earnings increase, the stock explodes, and if the data center falters, at least there’s GPU frosting. Having reported a quarter that was half celebration and half caution, analysts still are giving Buy ratings with big price targets.

Advanced Micro Devices gained a vote of confidence renewed by Cantor Fitzgerald this week. The firm reiterated its Overweight rating and $200 price target, despite a mixed second-quarter earnings report. As AMD rides out a high-growth cycle driven by AI acceleration and gaming competence, analysts seem cautiously positive that the chipmaker’s momentum ahead can support its premium valuation.

Q2 Earnings Top Revenue Estimates & Data Center Expansion Scales Back

AMD posted Q2 revenue of $7.69 billion, which is above the analysts’ expectations of $7.42 billion. Earnings per share were $0.48, which is in line with what Wall Street estimates. The firm’s 32% year over year revenue increase was heavily influenced by a robust comeback in its client and gaming divisions, particularly its semi-custom business.

That said, there was one specific area of concern. Its Data Center revenue growth decelerated to 14% year over year from the 57% year over year gain in the first quarter. This slowdown, combined with merely an in-line earnings number, provoked some after-hours selling. This indicated that the investors were hoping for a better performance from the AI-driven business segment.

AI Instinct Processors to Drive Q3 Acceleration

In spite of the mixed sentiment, Cantor Fitzgerald is optimistic. It mentioned AMD’s third-quarter revenue guidance of $8.7 billion, which is a bit above what the consensus estimates at $8.3 billion. Most importantly, the company referenced AMD’s Instinct MI355 AI processors as one of the top growth drivers, representing 75% of the estimated $1 billion quarter-over-quarter revenue growth.

The MI355 product ramp is viewed to be in its initial stages, and additional upside is anticipated during Q4 and later. AMD’s guidance specifically ignores any involvement or impact from MI308 sales to China, where there are pending license approvals. This leaves room for further revenue upside during the second half of 2025.

Analysts Sentiment

AMD’s price-to-earnings (P/E) of 127.12 suggests sharp valuation, but analysts are optimistic that the company can expand into it. AMD has a “GOOD” financial health rating from  InvestingPro, based on a healthy current ratio of 2.8 and minimal debt. This provides financial freedom in the capital-intensive AI arms race.

After the earnings release, UBS maintained its Buy rating and raised its target to $210. It referred to the start of a solid inflection in AMD’s Data Center GPU business. Stifel increased its target to $190, focusing on the enhanced AI compute capability of AMD. Barclays joined Cantor Fitzgerald at $200, pointing to AMD’s growing market share in AI chips. Mizuho and JPMorgan also raised their targets to $183 and $180, citing robust client segment performance.

High Ambitions

AMD is well-positioned for the AI future, with gaming and client segments already outpacing expectations and Data Center growth projected to gain momentum again later this year. Q3 guidance and analyst upgrades confirm AMD has a lot of room to grow, particularly if license approvals in China happen and demand for its MI355 chips remains firm.

However, the valuation today is not so forgiving. Investors will need to witness steady execution in the AI space and continuous market share gains as opposed to tough competitors such as Nvidia in order to support the stocks’ existing level. Still, the Street remains upbeat, and AMD appears ready to continue on its way upward.

From the big picture perspective, AMD’s valuation is elevated without any doubt. But it’s also a representation of investor optimism about what the company is creating, which is not only processors, but a solid position at the AI table. Enthusiasm regarding the ramp of MI355, China upside opportunity, and steady positive analyst rating indicates that AMD’s tale has not maxed out, rather it’s only a beginning of a new chapter.

For the long-term investor, holding on would be a sensible decision, as long as you can bear a little short-term volatility. For newcomers, purchasing at these levels may not be a screaming deal, but in the age of AI-powered innovation, sometimes paying a premium is the cost of entry.