Semiconductor company Advanced Micro Devices (AMD) saw its stock walloped today following a downgrade from five-star Goldman Sachs analyst Toshiya Hari. The firm’s analyst dropped shares of AMD from a Buy rating to a Neutral rating on Friday.
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Hari’s downgrade of AMD stock comes with a price target drop. The Goldman Sachs analyst decreased the firm’s price target from $175 to $125 per share. Despite that cut, the price target still represents a potential 12.11% upside for AMD shares over the next year.
AMD investors aren’t happy about today’s downgrade and price target cut, which has the stock down 5.48% as of this writing. That builds on a 22.26% fall over the past 52 weeks.
What’s Behind the AMD Downgrade?
Hari worries that competition from AMD’s rivals will weigh on its business. Arm (ARM), which has drawn customers in with its custom central processing units, is chief among these. Additionally, the firm is concerned about increasing competitive intensity in the accelerated computing market.
Even with these warnings, the Goldman Sachs analyst does offer some positives for AMD. That includes expectations for the company to continue taking a share of the x86-based compute market from Intel (INTC) with its PC and server products.
Another factor weighing on AMD stock today is the December Jobs Report. This came in stronger than expected, reducing chances for interest rate cuts in 2025. That has the stock market falling today with tech stocks leading the dive. This makes sense as many fit into the growth stocks category, which benefits from lower interest rates.
Is AMD Stock a Buy, Sell, or Hold?
Turning to Wall Street, the analysts’ consensus rating for Advanced Micro Devices is Moderate Buy based on 23 Buy, nine Hold, and one Sell ratings over the last three months. With that comes an average price target of $179.84, a high forecast of $250, and a low of $110. This represents a potential 56.41% upside for AMD shares.
