AMD $AMD has again delivered stellar results. 📈

The company posted another very strong quarter – record revenue, rapid growth in the data centre segment, excellent margins, and an optimistic outlook for the next quarter. From a fundamental perspective, there is really not much to fault in the results. The data centre once again drove the entire business, and it is clear that demand for AI infrastructure remains very strong.

Yet the stock is down about 7 % after the results were released. Why?

In my view, the main reason is that AMD was already priced for almost perfect future. The market had set extremely high expectations, and this time, “great results” simply weren’t enough. Investors wanted to see an even bigger surprise, a faster ramp-up of AI products, and an even more aggressive outlook. When expectations are so high, it often takes only a small disappointment to trigger profit-taking.

Personally, however, I remain optimistic in the long term. I think the most interesting period for AMD is still ahead. New AI products, the Helios platform, and the next generation of accelerators could be absolutely pivotal for the company in the coming years. If AMD manages to continue gaining market share in AI chips, today’s valuation may become much easier to justify over time.

And one more interesting point to conclude – the most bullish price targets from Wall Street analysts still suggest a potential upside of up to 1,300 USD (+170 %) per share. That is, of course, the most bullish scenario and by no means a certainty, but it illustrates the huge potential that some analysts still see in AMD.

What do you think? Is today’s drop just a short-term market reaction, or do you believe AMD is already too expensive?

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