AMD Downgraded to Hold Amid Nvidia Competition

Melius Research analyst Ben Reitzes downgraded Advanced Micro Devices (AMD) from Buy to Hold, reducing the price target from $160 to $129, citing increasing competition from Nvidia's Arm-based CPUs, which pose a significant threat to AMD's x86 server and PC markets. Reitzes expressed concerns about the potential cannibalization of AMD's market share as Nvidia expands its offerings, particularly in AI-optimized PCs. This downgrade follows a broader trend, with several analysts adjusting their ratings on AMD this year due to ongoing competition and market dynamics. Despite the downgrade, the consensus among analysts remains moderately bullish on AMD, with an average price target suggesting potential upside. AMD has seen a notable decline in its share price, down over 35% in the past year, adding to the urgency of Reitzes' assessment. Overall, while AMD's current chip, Turin, is performing well, long-term prospects appear uncertain amidst rising competition.