AMD vs. Palantir: Which AI Stock Offers Greater Potential for Growth, According to Wall Street?

Overview of AI Market Dynamics

• Emerging Leaders: Advanced Micro Devices (AMD) and Palantir Technologies (PLTR) are highlighted as key players in the rapidly evolving AI sector, with significant growth and investment potential.
• Market Performance: AMD has seen a 35% increase in stock value in 2025, while Palantir has surged by 107%, reflecting strong demand for AI technologies.

Advanced Micro Devices (AMD)

• Partnerships and Innovations: AMD has partnered with IBM to develop advanced computing solutions that integrate quantum technology, aiming to address complex challenges in fields like climate science and pharmaceuticals.
• Earnings Report: In Q2 FY2025, AMD reported a 32% year-over-year revenue increase, although earnings per share met expectations without exceeding them.
• Analyst Upgrades: Truist Securities upgraded AMD to a Buy rating, raising the price target from $173 to $213, indicating a potential 31% upside. Analyst William Stein noted AMD's growing market share in server CPUs, now over 20%, and projected earnings of $7.89 per share by 2027.
• Market Sentiment: Wall Street maintains a Moderate Buy consensus on AMD, with 25 Buys and 10 Holds, and an average price target of $184.74, suggesting a 13.60% upside.

Palantir Technologies (PLTR)

• Strong Demand and Growth: Palantir's stock has benefited from robust demand for its AI-driven platforms, particularly in government sectors like defense and intelligence, as well as expanding into commercial markets.
• Earnings Performance: The company exceeded expectations in Q2, achieving over $1 billion in revenue for the first time, a 48% increase year-over-year. It raised its full-year revenue outlook to between $4.142 billion and $4.150 billion.
• Analyst Insights: Wedbush analyst Dan Ives reaffirmed an Outperform rating with a $160 price target, highlighting strong growth in U.S. commercial revenue, now expected to rise 85% year-over-year in FY25.
• Market Consensus: Wall Street holds a Hold consensus on Palantir, with five Buys, 13 Holds, and two Sell ratings, and an average price target of $154.47, indicating a potential downside of about 1.43%.

Comparative Outlook

• Analyst Sentiment: Analysts express a more bullish outlook on AMD due to its solid fundamentals and growth prospects in AI, while maintaining a cautious stance on Palantir amid concerns over valuation and market conditions.