What Happened?
Shares of computer processor maker AMD (NASDAQ:AMD) jumped 5% in the afternoon session after Morgan Stanley raised its price target on the stock ahead of the company's first-quarter 2026 earnings release.
The bank increased its price target to $360 from $255, citing momentum in the company's data center business. The move comes as investor anticipation builds for the chipmaker's financial results, which are due after the market close. Enthusiasm has been driven by expectations of strong demand for its Instinct AI GPUs and wider adoption of its EPYC CPUs. This optimism persisted despite HSBC downgrading the stock from 'Buy' to 'Hold' a day earlier. HSBC noted that the stock's recent rally, which saw it climb significantly over the previous 12 months, had already factored in a lot of good news.
After the initial pop the shares cooled down to $356.60, up 4.5% from previous close.
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What Is The Market Telling Us
AMD’s shares are extremely volatile and have had 35 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago when the stock dropped 2.8% on the news that a broad selloff swept through the semiconductor industry, sparked by concerns over the future of artificial intelligence spending and rising geopolitical risks.
The negative sentiment followed a report from The Wall Street Journal which revealed that the AI firm OpenAI had missed internal targets for both new users and revenue. This news raised investor fears that a key player in the AI space might pull back on its heavy spending on data center infrastructure, potentially reducing demand for chips. Compounding these worries were escalating tensions between the U.S. and China over AI technology and broader concerns about global supply chain disruptions. The selloff was not isolated, affecting numerous semiconductor and AI-related stocks as investors reacted to the sector-wide headwinds.
AMD is up 59.6% since the beginning of the year, and at $356.60 per share, it is trading close to its 52-week high of $360.54 from April 2026. Investors who bought $1,000 worth of AMD’s shares 5 years ago would now be looking at an investment worth $4,582.
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