Paul Pointpass

DA Davidson Upgrades $AMD to Buy from Neutral, Raises PT to $375 from $220 Analyst comments: "We are upgrading shares of AMD based on a structural increase in CPU demand on top of much improved visibility into AMD's role in the great data center buildout. We believe that, given the magnitude of Intel's beat, there is meaningful upside to AMD's estimates, starting with the March quarter, which AMD is due to report on May 5. We figured CPUs were the next big bottleneck, but Intel's results indicate that this is already translating to very significant upside. In recent months, it has been clear that the CPU is reinserting itself as an indispensable foundation of the AI era, and the once-sleepy CPU market has taken off as agentic workloads shift compute needs beyond GPUs. We point to Intel's 1Q26 results as a key indicator of this demand, with Intel CFO Zinsner noting the company's expectation for the industry to grow double digits with momentum expanding into 2027. By Intel CEO Tan's assessment, the ratio of GPUs to CPUs will go from 8:1 for pretraining to closer to parity for agentic workloads. We view Intel's results as a precursor for a huge step-up for AMD's CPU franchise and believe the structural shift toward agentic AI workloads is creating unprecedented demand for server CPUs. We believe AMD is favorably positioned to significantly raise prices across the portfolio to support and expand margins, given our view that demand will outpace supply for the foreseeable future. We are raising our 2026 estimates for AMD by $2 billion of revenue and $1.5 billion of gross profit, now materially above guidance and consensus. Even though AMD has lower CPU share, if Intel can add about $2.5 billion a year of revenue and gross profit based on the tightness in CPUs, we are comfortable with those levels for AMD. Beyond CPUs, we must acknowledge AMD's long-term guidance has become much more achievable than it was just a few weeks ago. We regret not underwriting AMD's participation in the GPU buildout upon initiation, and the addition of Meta's 6 gigawatts and OpenAI's $122 billion fundraise tips the scale in favor of endorsing the 35% CAGR trajectory. We are upgrading to Buy from Neutral and raising our price target to $375 from $220, based on 32x CY27 EPS." Analyst: Gil Luria

What a day for the CPO sector especially with Sivers ( $SIVE ) up 31% but also $AEHR +9%! The real ramp for these companies is in 2027–2028, but days like today remind me that trimming profits is never a bad idea. We’re at the point where a lot of companies are getting shilled just because they have photonics in the story. It reminds me of when in 2020-2021 people were calling every new EV company ( $LCID, $NIO etc.) the new $TSLA and we all saw how it went. Do your own research — there are real opportunities, but also plenty of bad ones.