Advanced Micro Devices, Inc. (NASDAQ:AMD) has recently been spotlighted as one of the 15 Best Long Term Stocks to Buy according to Reddit discussions, highlighting its rising popularity and positive perception among retail investors. Loop Capital has reaffirmed its Buy rating on the stock, emphasizing an optimistic outlook for the future.
During AMD’s first analyst day since 2022, the company’s management engaged with investors over several hours, addressing key concerns regarding its growth trajectory. Loop Capital pointed out that AMD’s revenue is expected to grow significantly, driven by its potential to capture a portion of the data center market, continued advancements in closing the gap with Intel in server and PC markets, and ambitious targets for increasing non-GAAP earnings per share to over $20 within the next three to five years. Loop Capital set a price target of $290 for AMD, reinforcing their Buy recommendation.
Despite facing a period of slower growth in recent years, AMD’s hefty investments in artificial intelligence (AI) chips are beginning to bear fruit, as evidenced by a remarkable 36% increase in third-quarter revenue compared to the previous year, reaching $9.2 billion. The adjusted earnings per share also rose by 30%, while free cash flow hit an all-time high, signaling that the company is scaling profitably.
AMD’s success is attributed to its competitive cost-to-performance ratio, offering superior products compared to rival chips. Its fifth-generation Epyc server processors are gaining market share from Intel, and the MI300 GPUs are generating significant interest due to their effectiveness in AI inference tasks.
Recognized as a leader in high-performance and adaptive computing, AMD is playing a crucial role in driving innovation and solving complex problems across various industries. While some analysts believe that certain AI stocks present more growth potential with lower risk, AMD’s strong performance and strategic positioning suggest that it remains a worthy consideration for investors looking at the tech sector.
This positive outlook not only affirms AMD’s resilience and adaptability in a competitive landscape but also reflects the company’s commitment to innovation and growth for the future.