Investing.com -- Advanced Micro Devices (AMD) has been upgraded by DA Davidson on Friday, with the firm raising its rating to Buy from Neutral and lifting the price target to $375 from $220.

Analyst Gil Luria cited what they called “a structural increase in CPU demand” and improved visibility into AMD’s role in the accelerating data center buildout.

DA Davidson said it now expects “meaningful upside to AMD’s estimates, starting with the March quarter,” ahead of the company’s earnings report on May 5.

The firm also pointed to stronger-than-expected results from Intel as a key signal that the CPU market is reaccelerating.

According to the note, “Intel’s results indicate that [it] is already translating to very significant upside,” with executives highlighting double-digit industry growth through 2027.

The analyst believes the CPU is “reinserting itself as an indispensable foundation of the AI era,” as agentic workloads shift computing needs beyond GPUs. They cited Intel’s view that the GPU-to-CPU ratio, once around 8-to-1 for pretraining, is moving “closer to parity for agentic workloads.”

DA Davidson called Intel’s performance a precursor for a huge step-up for AMD’s CPU franchise, arguing that the shift toward agentic AI workloads is creating unprecedented demand for server CPUs.

The firm added that AMD is well-positioned to raise prices across the portfolio as demand is likely to outpace supply.

The analysts lifted their 2026 revenue estimate by $2 billion and gross profit by $1.5 billion, saying recent data makes AMD’s long-term targets “much more doable”.