Key Takeaways
- AMD shares rose 5% today ahead of earnings after Lynx Equity Strategies turned bullish on its Venice server chips.
- Navitas Semiconductor, Astera Labs and Credo also jumped as chip stocks bounced back from Monday’s sell-off.
- Intel is racing to add server-chip supply, giving AMD’s Venice room to take share.
- Analysts expect AMD’s earnings per share to more than double in 2027, and tonight’s server outlook is the number to watch.
Advanced Micro Devices (AMD) is up 5% this morning, hours before its third-quarter report, after Lynx Equity Strategies turned bullish. KC Rajkumar and his team put it simply: “We like the stock into print at current levels.”
Chip stocks are bouncing back from Monday’s sell-off too: Navitas Semiconductor (NVTS) is up 10%, Astera Labs (ALAB) 7% and Credo Technology (CRDO) 7%. Intel (INTC) is up 4%, and it’s central to Lynx’s case.
Venice is the chip to watch
Lynx sees demand for Venice, AMD’s 192-core, 2-nanometer server CPU, speeding up worldwide, driven by traditional data center work and AI agents, with limited competition from Intel. It wouldn’t be surprised if management signals tonight that its 2027 server outlook could prove conservative.
That outlook is already aggressive. On its August call, AMD guided for server revenue to grow more than 70% in 2027, after more than 80% in the second half of this year.
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Intel can’t make enough
Intel saw the same demand last week. Its data center and AI revenue jumped 78% to $7.3 billion in the third quarter. CEO Lip-Bu Tan said in Intel’s results release, “Our immediate priority is to unlock additional supply to meet extraordinary demand for our Xeon family.”
Much of that came from higher prices, though: Intel’s quarterly filing shows average selling prices in the business up 54%.
My read: some of the buyers Intel can’t serve end up on Venice. Can Intel add enough supply by its late-January report to win them back?
The bar is already high
Analysts expect AMD’s normalized EPS to more than double, from $7.62 this year to $16.01 in 2027:
A raised server outlook tonight should push those estimates higher.
AMD traded at 42x forward earnings at Monday’s close. That’s above its five-year average of 35x but well below the 67x it hit in June:
At this morning’s price, it’s about 44x.
Lynx picked the right chip
I think Lynx is right to like AMD here. Venice is AMD’s best shot at taking server share while Intel is short on supply.
Of course, prices that rose during a shortage can fall back once supply catches up. Tonight, I’ll watch whether AMD’s server growth comes from selling more chips or charging more for each.
So what is AMD stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
