Advanced Micro Devices (NASDAQ:AMD) knows all too well the frustration of being runner-up in an AI race where second place earns little applause. Over the past 12 months, AMD has delivered strong performance, yet remained stuck beneath Nvidia’s spotlight. Add to that the drag of macroeconomic headwinds and export restrictions, and it’s been a tough stretch for the chipmaker.
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But momentum may be shifting. With U.S.-China relations showing signs of easing, AMD has staged an impressive comeback, surging 44% off its April 8 low.
So, what now? Is this just a bounce off the bottom, or the early innings of something much bigger? According to top investor James Foord, it’s the latter. He sees AMD gearing up for a breakout year – one that could finally see it stepping into the ring as a real contender for AI supremacy.
“In my opinion, 2025 could be the year where AMD finally begins to make its mark in the AI market,” asserts the 5-star investor, who is among the top 3% of TipRanks’ stock pros. “AMD is quietly catching Nvidia – Wall Street just doesn’t see it yet.”
Foord notes that AMD’s MI350 – set to launch later this year – will offer both greater memory and bandwidth than Nvidia’s H200. The investor also points out that AMD’s EPYC processors operate more efficiently than Nvidia’s Grace CPU. While acknowledging that Nvidia still benefits from its CUDA software ecosystem, he adds that AMD has made “encouraging” updates to its own software through ROCm 6.4.
Another source of optimism for the investor is AMD’s recent 2025 Q1 earnings call, which reflected some positive trends such as gross profits increasing by 46% year-over-year (despite a drop in revenues from Q4, which Foord chalks up to seasonality).
With double-digit revenue growth projected for 2025, Foord is confident that there is value hidden in AMD’s modest valuation. The company’s share price is well below the sector median, explains the investor, leaving plenty of room for growth up ahead.
“The latest earnings confirm the bullish thesis, and if the geopolitical situation can settle down, then AMD could likely be one of the biggest winners in 2025,” concludes Foord, who rates AMD shares a Strong Buy. (To watch Foord’s track record, click here)
Wall Street seems to agree. With 23 analysts calling AMD a Buy and another 9 staying on the fence with a Hold, AMD earns a Moderate Buy consensus rating. The average 12-month price target stands at $125.07, implying a potential upside of 11%. (See AMD stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.