AMD Stock Upgraded to Buy with $250 Target Amid OpenAI Deal

Advanced Micro Devices (AMD) shares surged 6% on Wednesday after AZ Bank upgraded the stock to buy from hold, setting a $250 price target that implies an 18% upside. The chipmaker has gained 48% over the past month, buoyed by a multi-billion-dollar GPU supply deal with OpenAI.

AMD will deliver over 6 gigawatts of AI accelerators to OpenAI across multiple generations, beginning with MI450 chips in late 2026. The agreement includes an equity component granting OpenAI rights to acquire 160 million AMD shares at $0.01 each—potentially yielding a 10% stake. This follows Nvidia's recent $100 billion investment in the AI lab, creating a complex three-way partnership.

The company's technical indicators show bullish momentum, with shares trading above both the 50-day ($167.22) and 200-day ($135.02) moving averages. AMD currently commands a $343.25 billion market capitalization, though its elevated PE (121.56) and PEG (2.40) ratios suggest premium valuation.