Advanced Micro Devices (NASDAQ: AMD) stock has received a mixed update from a Wall Street analyst, citing concerns over valuation and limited upside potential.
In this line, HSBC analyst Frank Lee lifted AMD’s stock price target to $340 from the previous $335 target. Despite the higher forecast, Lee downgraded the shares to a ‘Hold’ rating from ‘Buy,’ signaling that the stock’s recent rally may have already priced in much of its near-term growth potential.
AMD shares were trading at $360 at the time of the update, implying a downside of roughly 5.7% relative to the new target price.
According to the analyst, AMD has undergone a significant valuation re-rating, with its price-to-earnings multiple expanding from about 19x to nearly 33x projected 2027 earnings.
HSBC noted that while AMD continues to benefit from strong artificial intelligence demand and broader semiconductor momentum, future earnings growth could be constrained by production capacity limitations.
The firm also introduced new 2028 estimates for AMD as it reassessed the company’s long-term outlook. However, HSBC maintained a cautious stance, arguing that the valuation expansion has largely played out following the stock’s strong performance.
Wall Street cautious on AMD stock
Overall, Wall Street analysts continue to maintain a bullish stance on Advanced Micro Devices stock, even as the company’s average 12-month price target suggests a potential pullback from current levels.
According to data compiled from 26 analysts over at TipRanks, AMD holds a ‘Moderate Buy’ consensus rating, supported by 17 buy ratings, nine hold ratings, and no sell recommendations.
Analysts currently project an average 12-month price target of $308.09 for AMD shares. While that target implies a 14.55% downside from the latest share price of $360.54, sentiment around the chipmaker remains largely positive amid continued investor interest in artificial intelligence and high-performance computing markets.
The most bullish forecast places AMD stock at $375 over the next 12 months, slightly above current levels, while the lowest target stands at $240.
AMD shares have experienced strong gains over the past year, with the stock rallying sharply into May 2026 as demand for AI-related semiconductor products continues driving momentum.
