To The Moon

Here’s my analysis and outlook — with caveats, because a 25% jump shifts the risk/return profile significantly.

Key considerations after the 25% jump

The announcement of a multi-billion chip supply deal with OpenAI — including warrants giving OpenAI the option to acquire up to 10% of AMD shares at $0.01 each under certain milestones — has understandably triggered a dramatic revaluation. 

That said, several factors now matter more than ever:

Already baked in optimism: Much of the near-term upside may already be priced in. A strong bump often shifts the narrative from how much more to how durable the gains will be.

Execution risk and time horizon: The deal stipulates deployments starting in 2026, scaling to 6 GW of compute over multiple phases. The market is effectively discounting years of forward performance.

Warrant dilution & contingent issuance: The warrants vest upon milestone achievements. If OpenAI exercises them, there is theoretical dilution risk. 

Comparative standing vs Nvidia: Nvidia has a dominant position, strong product pipeline, and well-entrenched ecosystem. AMD will need to prove it can not just win clients but sustain margins in high-performance AI workloads.

Valuation stretch & downside risk: After a 25% surge, the stock may become vulnerable to profit taking, or disappointment if any detail underwhelms relative to the hype.

Given all this, yes, there is still upside potential — but it’s no longer pure beta play; it’s much more about narrative, execution and confidence.

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AMD vs Nvidia — who has further runway?

Broadly speaking:

Nvidia is deeper into the AI infrastructure moat. It’s the default go-to for many model builders. Its scale, robustness, software stack (CUDA ecosystem), and incumbency give it inertia that’s hard to dislodge.

AMD is playing the “underdog pushing into the fortress” role. If AMD can execute its roadmap, deliver competitive chips, and capture meaningful share, its upside could be steeper (though riskier).

Over the next 12–18 months, Nvidia likely retains a safer “first leg” of upside. But AMD now has a more meaningful shot at participating in the AI infrastructure boom — especially if OpenAI adoption proceeds.

So I see Nvidia possibly being more “steady” and less volatile (on the upside) compared to AMD, which may offer more asymmetric return but also higher drawdown risk.

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Price target (PT) estimates and scenario ranges

These should be taken with caution — they depend heavily on assumptions about AI adoption, product cycles, margins, and competitive dynamics.

Ticker Baseline PT (12-18 mo) Bull case Bear / base-case downside

AMD $200–$220 $250+ (if AMD captures >10% share in AI workloads, strong margins) $150–$180 (if execution stumbles or dilution concerns bite)

Nvidia $200–$220 $250–$300 (if AI infrastructure cycle accelerates further) $160–$190 (if competition intensifies or growth slows)

Supporting reasoning / reference points:

UBS has reiterated a Buy rating on AMD with a $210 target. 

MarketBeat and other aggregators suggest AMD’s consensus is around $198.30 in some estimates. 

Wells Fargo had raised AMD’s target earlier to $185 in anticipation of data center growth. 

For Nvidia, analysts like Citi have lifted their target to $190 citing AI tailwinds. 

Needham recently raised Nvidia’s price target to $200 based on expectations of reopened China sales and continued AI demand. 

The consensus estimates for Nvidia hover around $206 in some sources. 

Given Nvidia’s more mature positioning, its upside seems somewhat compressed relative to AMD (on a percentage basis), but with lower relative risk.

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Will AMD follow Nvidia’s “new high pace”?

It could, but several conditions must hold:

1. Sustained new deal flow: AMD needs not just the OpenAI win but a steady stream of adoption across hyperscalers, cloud providers, and AI model builders.

2. Competitive performance parity: Its chips must compete favorably (in both speed and power efficiency) with Nvidia’s offerings in real workloads.

3. Margin preservation: If AMD sacrifices margins to gain share, it may undercut investor returns.

4. Investor confidence / narrative maintenance: The market’s faith in the path matters — if any misstep or lack of clarity emerges, the follow-through might falter.

5. Wider macro / liquidity support: A positive environment for technology and growth stocks is helpful; in risk-off regimes, these names tend to be volatile.

If all those fade or run into headwinds, AMD could lag or retrace sharply. But if they hold, AMD has a decent shot of replicating Nvidia’s breakouts (though likely with more volatility).

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My current stance (short to medium term)

Cautiously bullish on AMD after this move: I’d expect some pullback or consolidation in the near term (profit taking), but the path is skewed to the upside if execution is credible.

Still constructive on Nvidia: It’s not a “trade” in the same way, but more of a core tech/AI long with less downside risk.

Balanced exposure might make sense: Holding some position in both, with a bit more conviction in AMD’s potential upside (albeit high risk), but preserving exposure to Nvidia as a more stable anchor.