Advanced Micro Devices Stock Gains Momentum on Multiple Catalysts

Shares of Advanced Micro Devices (AMD) continued their recent upward trajectory on Thursday, posting a significant gain of 5.81 percent. Investor sentiment was buoyed by a confluence of favorable developments, including bullish analyst commentary, robust results from a key manufacturing partner, and the announcement of a new strategic alliance.

The positive momentum was partly fueled by news from Taiwan Semiconductor Manufacturing Company (TSMC), AMD's primary supplier for cutting-edge semiconductors. TSMC's fourth-quarter 2025 results substantially exceeded market expectations, sending its own shares up by 6.2 percent and providing a tailwind for the broader chip sector, including peers like Nvidia and Broadcom. These strong forecasts from the foundry giant reinforce the demand outlook for AMD's data center products.

Simultaneously, AMD revealed a collaboration with Tata Consultancy Services (TCS) announced on January 14. The partnership is designed to create customized artificial intelligence solutions for industries including life sciences, manufacturing, and financial services. TCS also plans to train and certify its personnel on AMD's hardware and software platforms. "AI adoption is accelerating, and unlocking its potential requires a new scale of high-performance computing," stated AMD CEO Lisa Su. TCS Chief Executive K. Krithivasan emphasized that the alliance aims to help organizations move "from AI experimentation to AI at scale."

Wells Fargo Analyst Outlines Substantial Upside

Adding to the optimistic backdrop, Wells Fargo analyst Aaron Rakers reaffirmed his bullish stance on Thursday morning. He maintained an "Overweight" rating with a price target of $345, implying a potential upside of 54 percent from recent levels. Rakers identified AMD as a top pick in the semiconductor space for 2026, citing anticipated "insatiable demand" for data center capacity.

Should investors sell immediately? Or is it worth buying AMD?

His analysis highlights several core growth drivers:
* Leadership in the CPU market alongside increasing server segment share
* A strong market position for the rack-based AI infrastructure Helios system, unveiled at CES 2026
* An expanding portfolio of AI accelerators, including the upcoming MI400 series
* A visible pathway for earnings per share to exceed $20 by 2029

This view follows an earlier upgrade by KeyBanc Capital Markets on January 13 to an "Overweight" rating, which pointed to AMD's nearly sold-out server CPU production for 2026. The consensus among 36 covering analysts remains a "Strong Buy," with an average price target of $283.66.

Upcoming Earnings and Broader Market Context

Market participants are now looking ahead to AMD's financial report for the fourth quarter and full year 2025, scheduled for release after the market closes on February 3. Analysts at Bank of America anticipate a "beat and raise" scenario, with results surpassing estimates and management providing an improved outlook. Key focus areas will include AI-specific revenue, forecast to reach $14-$15 billion in 2026, as well as updates on the MI400 accelerator series and the Helios system slated for launch in Q3 2026.

The positive sentiment surrounding TSMC's performance and the new partnership appeared to overshadow news from the White House regarding new 25 percent tariffs on advanced GPUs, including AMD's MI325X accelerator, sold to China. Trading near $223.60 and boasting a twelve-month advance of nearly 92 percent, AMD remains prominently positioned within the ongoing AI investment cycle.