Chipmaker Advanced Micro Devices (AMD) drew investor attention on Tuesday, with the stock climbing over 4% after Bank of America Securities raised its price target. Top Analyst Vivek Arya increased the target from $120 to $130 while maintaining a Buy rating, implying about 10% upside potential from current levels.
Confident Investing Starts Here:
- Quickly and easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions
- Receive undervalued, market resilient stocks straight to you inbox with TipRanks' Smart Value Newsletter
The price hike comes on the heels of AMD’s announcement of a multi-year AI infrastructure partnership with HUMAIN, a subsidiary of Saudi Arabia’s Public Investment Fund. The deal, reportedly worth $10 billion, was unveiled during President Trump’s recent visit to Saudi Arabia. Meanwhile, Nvidia (NVDA) also signed a separate agreement with HUMAIN to help develop AI factories in the region.
Arya’s Views on the AI Infrastructure Projects with HUMAIN
The five-star analyst calls AMD and Nvidia the “top winners” from Saudi Arabia’s sovereign AI push. According to Arya, these projects with HUMAIN could generate $3–$5 billion annually, or $15–$20 billion over time. These long-term deals are expected to help offset export restrictions to China and ease data center power constraints in the U.S.
The analyst also highlighted the broader potential of sovereign AI, government-led AI projects designed to fit a country’s language, culture, and infrastructure. Arya believes this segment could evolve into a $50 billion+ annual market, accounting for 10–15% of the global AI infrastructure space, projected at $450–$500 billion. He added that these efforts “nicely complement commercial cloud investments” and could give AMD a strong path for long-term growth.
The bank also emphasized that the ripple effect from these compute-heavy deals will likely benefit other players across the ecosystem, including Broadcom (AVGO) and Marvell (MRVL), thanks to their roles in networking, memory, and optical technologies.
Overall, the analyst believes that AMD is now in a stronger position to benefit from rising AI demand. He describes GPUs as the new “coin of the realm.”
Is AMD a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on AMD stock based on 22 Buys, nine Holds, and zero Sell assigned in the past three months, as indicated by the graphic below. Furthermore, the average AMD price target of $126.14 per share implies 7.15% upside potential.
