Advanced Micro Devices (AMD) shares surged after the company announced a multi-year hardware agreement with OpenAI and expanded its collaboration with Oracle. Both partnerships focus on large-scale deployment of AMD’s Instinct GPUs beginning in 2026.

AMD’s momentum has accelerated, fueled by this flurry of AI partnerships and fresh analyst confidence. While the stock dipped modestly today, the 30-day share price return of 46% reflects surging enthusiasm, and a 1-year total shareholder return of 49% puts its gains firmly ahead of the wider market. These blockbuster wins with OpenAI and Oracle are not just news events; they suggest AMD’s leadership in AI infrastructure could reshape its growth trajectory for years to come.

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With AMD’s rapid string of wins and bullish analyst upgrades, the key question remains whether current prices undervalue the company’s AI future or if the stock has already reflected every ounce of anticipated growth.

Most Popular Narrative: 11% Overvalued

According to the most popular narrative from codepoet, AMD’s implied fair value is noticeably below its last close of $233.08. This has prompted a closer look at what is powering this premium. The narrative’s take focuses on transformative AI deals, breakthrough product launches, and the huge financial stakes now at play.

It gives AMD higher visibility and credibility in the AI compute and infrastructure market, positioning it as a more serious challenger to NVIDIA. For OpenAI, the deal diversifies their sourcing of compute, gives them upside exposure to AMD if things go well, and aligns incentives with AMD’s success.

Want to peek under the hood of this fair value? The narrative analyzes aggressive profit projections, unprecedented revenue expansion, and high-stakes margin bets. Which critical financial driver tips the scales? See what makes this forecast so bold.

Result: Fair Value of $210 (OVERVALUED)

However, competitive pressures from Nvidia’s dominance, as well as the risk of regulatory export restrictions, could quickly shift AMD’s ambitious AI growth story.

Build Your Own Advanced Micro Devices Narrative

If you want to challenge these viewpoints or dig into the numbers yourself, you can craft a personal take on AMD’s story in just a few minutes with Do it your way.

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Advanced Micro Devices.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.