Prediction: AMD Stock Will Reach $400 Over 3–5 Years, Says Investor

Advanced Micro Devices (NASDAQ:AMD) stock has been racing up the charts throughout the latter half of 2025, jumping 150% since hitting an early-April trough. The rally has been driven by renewed enthusiasm around AMD's expanding role in AI infrastructure, as accelerating hyperscaler spending, strong data-center momentum, and growing confidence in the company's inference opportunity helped reposition the stock as a credible beneficiary of the AI build-out.Claim 50% Off TipRanks Premium and Invest with Confidence Unlock hedge-fund level data and powerful investing tools designed to help you make smarter, sharper decisions Stay ahead of the market with the latest news and analysis so your portfolio is always positioned for maximum potential But momentum cuts both ways. As chatter around a potential AI bubble grew louder, the rally began to lose steam. Since topping out at an all-time high in late October, AMD shares have pulled back about 19% overall, even after accounting for a 6% bounce in the last trading session. Still, hyperscaler spending shows no signs of slowing, and AMD has projected revenues in the tens of billions of dollars by 2027. So which narrative will ultimately sway sentiment going forward: the AI build-up or the AI bubble? Top investor Julian Lin is brushing aside his past worries about the company's valuation and believes the current trends are firmly in AMD's favor. "The best-case scenario appears to have occurred, with escalating CapEx spending creating a large market in inference," explains the 5-star investor, who ranks among the top 1% of stock pros covered by TipRanks. While AMD's technological prowess doesn't quite match Nvidia's, Lin believes AMD is "good enough" to supply hyperscalers with what they are looking for. In fact, Nvidia's high margins may be creating an opening for AMD to capitalize on the inference opportunity. "Whereas they might still want to employ the top-of-the-line models from NVDA for training, they might be willing (or eager) to employ cheaper models from AMD for inference," Lin adds. This supports AMD's thesis of 35% top-line growth going forward. AMD is also predicting an operating margin of at least 35%, which would be accompanied by an EPS of $20 by 2030. Based on those assumptions, and applying a 20x P/E multiple, Lin calculates that AMD's share price still has meaningful room to run. "Potential upside remains as AMD capitalizes on inference market demand, with a $400 price target implying 13% annualized returns over 3–5 years," Lin sums up, assigning the stock a Buy rating. (To view Julian Lin's track record, click here) Wall Street's outlook is also very supportive, albeit less aggressive than Lin's longer-term thesis. That balance is reflected in AMD's Strong Buy consensus rating, backed by 29 Buys and 9 Holds, while the 12-month average price target of $279.94 points to 31% upside over the year ahead. (See AMD stock forecast)