Advanced Micro Devices (AMD) has been on a roll over the last year, with stock prices rising by nearly 297%. Wall Street analysts are becoming increasingly bullish on AMD, given the AI-centric outlook for the future and the company’s CPU (Central Processing Unit) and GPU (Graphics Processing Unit) manufacturing capabilities. AMD was also included in Bank of America’s list of companies that are predicted to dominate the next decade. Let’s look at why Wall Street is paying so much attention to the chip manufacturer.

Why Is Wall Street So Bullish On AMD?

AMD is a top competitor to Nvidia (NVDA) in its GPU business. GPU use and sales have shot up in the age of AI, leading to significant gains for both companies. Nvidia (NVDA) is the clear market leader in this front. Things, however, could change in the coming years.

AMD has seen a drastic transformation over the last few years. The advent of AI has especially turned the tide for the company. While AMD has been a beneficiary in the ongoing AI boom, the best is probably yet to come for the company. We are slowly entering the era of agentic AI. Unlike current GPU-focussed AI models, agentic AI relies more on CPU power. This could be a game changer for AMD. It could even take the competition to Nvidia. Although Nvidia does manufacture some AI-capable CPUs, it is now quite known for its CPU business.

Also Read: Is Nvidia Stock a Bargain While AMD Surges 150% and Intel 256%

While AMD’s CPU and GPU manufacturing has given a lot of weight for bullish projections, the company’s data center business could become its primary financial engine. In fact, data centers have become AMD’s fastest growing business. There is a massive demand for EPYC server CPUs and Instinct AI accelerators. Wall Street is betting big on AMD’s AI infrastructure.

Also, analyst anticipate increased AI spending in the future. This capital will likely trickle its way into AMD coffers.