AMD, Intel Surge Following Two Upgrades. Here’s Why a Wall Street Optimist Favors These Shares

Intel and AMD Shares Surge Following Analyst Upgrades

Intel's stock reached its highest level in almost two years on Tuesday, reflecting renewed optimism among investors.

Main Highlights

• Both Intel and AMD experienced significant gains after KeyBanc analysts upgraded their ratings, citing robust demand for artificial intelligence technologies.
• According to the analysts, both companies have nearly exhausted their projected server CPU capacity for 2026 and are contemplating price increases due to strong demand.

On Tuesday, Intel and AMD were among the top-performing stocks in the S&P 500 and Nasdaq, buoyed by positive analyst sentiment on Wall Street.

Intel (INTC) shares climbed close to 9%, while Advanced Micro Devices (AMD) jumped more than 6%, even as the broader market trended downward. The surge followed KeyBanc's decision to upgrade both stocks to "overweight," highlighting unexpectedly high demand for their AI-related products.

KeyBanc's research indicates that both companies have already sold most of their anticipated server CPU supply for 2026, driven by data center needs. The strong demand is prompting both chipmakers to consider price hikes of 10% to 15%.

What This Means for Investors

These upgrades may help restore confidence in Intel, which has faced challenges in revamping its operations, and in AMD, which has long been viewed as trailing behind competitor Nvidia.

The analysts have increased their shipment forecasts for both companies this year. They also noted that Intel's new "18A" manufacturing process could position the company as the industry's second-largest foundry, just behind Taiwan Semiconductor Manufacturing Co. (TSM).

KeyBanc's bullish stance on Intel is unique among Wall Street firms tracked by Visible Alpha, with KeyBanc being the sole "buy" recommendation, compared to five "hold" and two "sell" ratings. Their price target of $60 per share, representing a potential 36% increase from Monday's closing price, stands well above the consensus target of $41.

Analyst sentiment is more favorable for AMD, with seven out of ten Visible Alpha-tracked ratings recommending a "buy" and the remaining three suggesting a "hold." KeyBanc's $270 price target for AMD, which implies a 30% upside from Monday's close, is in line with the average analyst estimate.