Advanced Micro Devices (AMD) is expected to post a beat in its Q1 results, though upside may be limited by tight wafer supply and relatively lower central processing unit exposure compared with Intel (INTC), RBC Capital Markets said in a note emailed Friday.

AMD is scheduled to report its Q1 results after the market closes on May 5.

The brokerage also expects Q2 revenue and EPS guidance to come in above expectations by the same magnitude of 4% to 6% beat estimated for Q1.

RBC said demand for CPUs remains strong, with average selling prices driving growth, though "wafer supply tightness is a limiting factor as AMD's lead times appear to have extended beyond 4-6 weeks."

RBC maintained a sector perform rating and raised its price target to $325 from $230, citing recent peer multiple expansion.

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