Weekend Roundup: Top 10 AI Stocks on Latest News and Ratings

6. Advanced Micro Devices, Inc. (NASDAQ:AMD)

Number of Hedge Fund Holders: 107

Advanced Micro Devices, Inc. (NASDAQ:AMD) develops semiconductors, providing processors and graphics technologies for gaming, data centers, and AI-driven high-performance computing. On February 14, Daiwa downgraded the stock to “Outperform” from Buy with a price target of $130, down from $170. The firm has cited weaker-than-expected first-half guidance for 2025 as a reason for the downgrade.

While Q4 2024 results were strong, analysts view the “big issue” to be “material disappointment” in graphics processing units as MI325 seems to be ramping slower than expected. According to the firm, this is holding the company back from achieving an “AI premium”. The firm said that AMD’s Q1 2025 revenue guidance of $7.1 billion came in $105 million above Street estimates, but noted that data center revenue for the first half of the year is anticipated to decline.

“The DC guidance for 1H25 is to be ‘consistent’ with results of 2H24, which was revenue of $7.4b. This would suggest that DC 1H25 has to come down ~$800m from our/street expectations”.

-Daiwa explained.

All in all, the firm currently remains cautious on the weaker-than-expected first-half guidance but anticipates the second half to be robust with AMD’s MI350 GPU ramping up earlier than planned.