Advanced Micro Devices Inc

Semiconductor majors Advanced Micro Devices, Inc. (NASDAQ: AMD) and Qualcomm (NASDAQ: QCOM) recently revealed that the companies have entered into a partnership to optimize the Qualcomm FastConnect connectivity system for AMD Ryzen processor-based computing platforms.

Following the news, shares of AMD rose more than 9% to close at $102.80 in Tuesday’s extended trading session.

Strategic Impact

The collaboration will initially begin with AMD Ryzen PRO 6000 Series processors and the Qualcomm FastConnect 6900, which will cater to laptops featuring Microsoft’s (NASDAQ: MSFT) Windows 11.

The collaboration will bring Qualcomm’s FastConnect 6900 system to AMD Ryzen processor-powered business laptops, which will enable the Wi-Fi 6 and 6E bands to outperform traditional single-band connections for improved video conferencing experiences, reduced latency and enhanced connection robustness.

Management’s Commentary

The General Manager of OEM Client Computing at AMD, Jason Banta, said, “Out-of-band Wi-Fi remote management is an important tool for enterprise IT managers to diagnose and fix issues, even when the operating system is not running. AMD Ryzen™ PRO 6000 Series processors with Qualcomm FastConnect 6900 enable next generation business laptops to have the processing and connectivity tools needed to perform in modern environments, offering professional-strength remote manageability for users in the new, hybrid workplace.”

Stock Rating

On May 17, Piper Sandler analyst Harsh Kumar upgraded the stock to Buy from Hold with a price target of $140, which implies upside potential of 36.6% from current levels.

The Wall Street community is cautiously optimistic about the stock and has a Moderate Buy consensus rating based on 14 Buys and nine Holds. AMD’s average price target of $133.95 implies that the stock has upside potential of 30.7% from current levels. Shares have gained 37.7% over the past year.

Hedge Funds Confident

TipRanks’ Hedge Fund Trading Activity tool shows that hedge fund confidence in AMD is currently Very Positive. Moreover, the cumulative change in holdings across all 17 hedge funds that were active in the last quarter was an increase of 9.4 million shares.

Conclusion

AMD’s shift towards the commercial personal computers market has been beneficial for the company. Further, the collaboration with Qualcomm to cater to the same market with more efficient and powerful processors is further expected to aid the company’s growth prospects.