Benzinga·2026-01-13 15:20Core Viewpoint - KeyBanc analyst John Vinh upgraded both Advanced Micro Devices, Inc (AMD) and Intel Corp (INTC) stocks due to strong server demand for artificial intelligence [1] Group 1: Server Demand and Market Trends - December cloud data indicated a modest pullback in traditional servers as providers retired older instances, leading to a 2% month-over-month decline in compute processor instances, but an 11% year-over-year increase [2] - Total cloud instances also fell 2% sequentially while rising 10% from a year ago, with Vinh favoring Intel over AMD for near-term instance momentum [3] Group 2: Company Performance - Intel's instances declined 3% month-over-month, but its newest Granite Rapids generation saw a 12% month-over-month increase to 1,933 instances, driven by AWS deployments [4] - AMD's processor instances remained flat month-over-month in December, with a 16% year-over-year increase [4] Group 3: Growth and Valuation - Turin instances grew 4% month-over-month to 2,252, supported by deployments across Alibaba, AWS, and GCP, while combined latest-gen AMD growth (Turin/Genoa) increased 2% month-over-month [5] - Vinh upgraded AMD's rating from Sector Weight to Overweight with a $270 price forecast based on 34x his 2026 EPS estimate of $7.93, noting AMD trades at 32x the 2026 consensus EPS compared to peers averaging 27x [5] - Intel's rating was also upgraded from Sector Weight to Overweight with a $60 price forecast based on 4.0x EV/S on his 2026 revenue estimate of $57.8 billion, while Intel trades at 4.3x consensus EV/S versus a three-year median of 2.6x [6] Group 4: Price Actions - AMD stock increased by 6.14% to $220.30, while Intel stock rose by 3.15% [6]