Intel stock was gaining Tuesday after getting upgraded at KeyBanc. It’s set to be a good year for makers of central processing units, including Advanced Micro Devices, the analysts say.
Analyst John Vinh raised his rating on both Intel and AMD to Overweight, noting the companies appear to have largely sold out their server CPUs for this year amid the boom in artificial-intelligence infrastructure.
Intel got a price target of $60 from the KeyBanc analyst, which is one of the highest calls on Wall Street according to a FactSet poll. Intel stock rose 7.3% to $47.29, setting a new 52-week high.
“Our checks indicate Intel is almost sold out for the year in server CPU, and given the strength in demand, the company is considering a 10-15% ASP [average selling price] increase,” Vinh wrote in a research note.
In addition, Vinh is positive on Intel’s efforts to expand its chip-manufacturing operations. Although he doesn’t believe the company’s 18A manufacturing process is enough to challenge industry leader $Taiwan Semiconductor ManufacturingTSMC$, he argues it could lead Intel to take second spot as an advanced semiconductor manufacturer fromSamsung Electronics.
“18A progress [is] enough to convince us it could credibly be the #2 foundry supplier in the industry ahead of Samsung. We are seeing significant progress being made on foundry with 18A yields improving to over 60%,” wrote Vinh.
Apple looks to have become a customer of Intel’s foundry, or chip manufacturing unit, for low-end processors for MacBooks and iPads, for production from 2027, according to Vinh. He also believes Intel is in discussions with Apple over the potential for its next-generation 14A manufacturing process to be used for low-end mobile A-series processors for iPhones in 2029.5
AMD got a price target of $270 from Vinh. The stock rose 6.4% to $220.97.
The KeyBanc analyst argued AMD’s revenue from server CPUs is set to grow at least 50% this year, with similar price increases to Intel. Meanwhile, sales of its MI355 and MI455 graphics-processing units will lead to annual AI revenue of between $14 billion and $15 billion.
“Regarding AI GPUs, we’re seeing indications of 200K MI355 GPUs in the first half and a significant ramp of MI455 in the second half, of which 290K-300K is targeted for [AMD’s] rack scale solution Helios,” Vinh wrote.