KeyBanc’s Jon Vinh raised his 12-month forecast for Advanced Micro Devices (NASDAQ: AMD) stock on January 13 to $270, meaning he now expects a 26.84% rally from the equity’s press time price of $212.86: a welcome turn should it come, considering the chipmaker’s stock declined 0.61% since New Year’s Day.
Simultaneously, the Wall Street expert revised his previous ‘sector weight’ – ‘Hold’ – to ‘overweight’ – ‘Buy’ – rating, while citing a series of internal and external bullish factors.
Our supply chain checks indicate the recent surge in hyperscaler demand has led AMD to almost being completely sold out of server CPU in 2026 and potentially considering a price increase of 10-15% in 1Q26. We estimate server CPU for AMD will grow at least 50% this year.
This latest analyst price target upgrade hints at renewed confidence that AMD – arguably the world’s second semiconductor giant – will finally end its long lag behind Nvidia (NASDAQ: NVDA) in 2026.
KeyBanc’s 2026 bull case for AMD stock
According to Vinh, KeyBanc’s supply chain checks demonstrated a surge in hyperscale demand for AMD’s products that led to them being essentially sold out and to a 10-15% price increase coming under consideration.
The analyst also noted that he expects server CPU sales could grow 50% in the next 12 months and that it could support Advanced Micro Devices’ revenue in 2026 between $14 and $15 billion when paired with demand for MI455/Helios solutions.
Should such an expectation be met, AMD would become one of the fastest-growing players in the global AI chip market.
Still, the KeyBanc expert noted that AMD’s actual ability to sell its racks remains to be seen, leaving some room for uncertainty.
Retail customers disgruntled over AMD’s 2026 direction
Elsewhere, the semiconductor giant’s recent decisions have – much like Nvidia’s – been met with a mixed reception. Of particular note has been the absence of new consumer hardware at the Consumer Electronics Show (CES), with some commentators describing the focus on artificial intelligence (AI) – and AI-related rhetoric – as ‘incessant.’
Indeed, the rumored price increases and production cuts to chips intended for non-business clients have been met with an uproar, primarily from the gaming community.
In response, Rahul Tikoo, a senior AMD executive, claimed that the recent ‘memory squeeze’ is no cause for concern as customers still have access to a wide variety of cheaper products.
The growing backlash from gamers and PC buyers could become a headwind if AMD sacrifices consumer market share to chase AI margins, with the danger being especially significant should the suspected industry bubble burst before the hopes for ‘artificial general intelligence’ (AGI) are fulfilled.
Though not a mirror-image of Nvidia’s alleged consideration to restart production on older, weaker models for the mass market, it is certainly an echo of the competitor’s rumored solution.
Lastly, despite the growing displeasure over the widespread focus on AI within certain segments of society, it is likely that KeyBanc’s bull case for AMD remains on firm ground, at least in 2026.
Featured image via Shutterstock
