The initial months of 2026 have been quite tough for investors in Advanced Micro Devices (NASDAQ: AMD), with the semiconductor company’s shares having surged 131% this year.
Yet, AMD’s stock momentum seems to be faltering recently, having dropped nearly 5% as part of a broader stock market downturn. Concerns regarding a possible bubble in the stock market—fueled by high-tech stocks, particularly those linked to artificial intelligence—have been weighing heavily on investor sentiment. However, labeling AI as a bubble could be a misstep.
Remember Nvidia back in 2009? Well, another unique signal is appearing again. Back then, a “double down” signal emerged for a relatively unknown chipmaker called Nvidia. Interestingly, a firm that is 100 times smaller than Nvidia is now giving off the same “full conviction” signal.
The ongoing adoption of this technology is expected to not only drive solid growth for the involved hardware and software companies but also enhance productivity for users. It’s perhaps not surprising that AMD’s shares saw a spike again in July, especially with the anticipation of a major customer announcement during the Advancing AI event later this month.
AMD’s Upcoming Event Could Enhance Investor Confidence
AMD is set to hold the Advancing AI event on July 22nd and 23rd. The company is expected to unveil its new AI-centric platform, how customers can integrate it, and its forthcoming product roadmap. Last June, AMD hosted a similar event to showcase a server architecture called Helios.
This server platform is attracting attention, as AMD management mentioned during their earnings call in May that there is significant demand for the Helios platform. More details are likely to emerge during the July event.
If AMD can indeed attract more clients to Helios, it would position the company favorably against Nvidia. Should investor sentiments shift positively with the introduction of Vera Rubin’s Chip System, things might look up for AMD. It’s worth noting that the AMD Helios rack-scale system offers substantial advantages, including 432 gigabytes of high-bandwidth memory, significantly surpassing Nvidia’s offering of 288 GB.
As memory has become a critical factor in AI infrastructure, there’s a reasonable possibility that AMD could outperform competitors and capture more hyperscaler customers. In May, Citigroup pointed out that AMD might have brought Anthropic onto their client roster, with an announcement likely during the upcoming event.
Could Good News Be on the Horizon for AMD?
Therefore, potential positive updates in July might provide AMD with the push it needs to regain momentum.
Is This the Right Time to Invest?
Right now, with a trailing P/E ratio of 173 and a forward P/E ratio of 73, it’s clear that AMD’s stocks are priced higher than what some might consider reasonable. Investors pursuing value might want to look elsewhere. However, if you’re comfortable with risk and interested in adding a fast-growing company to your portfolio, AMD could be appealing.
This year, earnings per share are projected to climb by 77%, reaching $7.39. Importantly, AMD is also expected to maintain robust growth rates for the foreseeable future.
If we consider that earnings could potentially rise to $18.30 by 2028, and the P/E ratio aligns with tech-heavy averages, AMD’s stock price might hit $732, indicating a possible increase of 41% from where it stands now. Still, it wouldn’t be unusual for the company to show even stronger-than-expected revenue growth, thereby maintaining its premium valuation and boosting profits.
Should You Consider Buying AMD Now?
If you’re contemplating an investment in Advanced Micro Devices, there are a few factors to weigh.
While some analysts claim that there are better stocks available for investment right now, AMD’s potential for growth might still captivate those interested in tech stocks.
*Stock performances noted may return by July 4, 2026.
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