Advanced Micro Devices Inc. (AMD  ) stock rose nearly 2% Friday as investors bought semiconductor and artificial intelligence stocks despite weakness across the broader market.

AMD shares gained even as the S&P 500 fell 0.43% and the Dow Jones Industrial Average dropped 1.16%. The Nasdaq Composite edged up 0.21%, supported by strength in technology stocks.

Chip Stocks Buck Market Weakness

Investors favored select technology stocks Friday as broader market sentiment remained weak.

Only two of the S&P 500's 11 sectors advanced, while the advance-decline ratio stood near 0.2. The reading showed that declining stocks sharply outnumbered gainers.

Technology rose 0.63%, making it the second-best performing sector behind energy, which gained 2.50%.

AMD outperformed the technology sector by about 1.18 percentage points, suggesting investors were selectively buying semiconductor and AI-related stocks.

However, the technology sector remained under pressure. It fell 6.09% over the past 30 days despite gaining 5.25% over the past 90 days.

Technical Analysis: Long-Term Uptrend Faces Pressure

AMD remains in a long-term uptrend but faces near-term technical challenges.

The stock trades 28.4% above its 200-day simple moving average (SMA) of $402.08. Its 50-day SMA also remains above its 200-day SMA, signaling a positive longer-term trend.

However, AMD trades 12.1% below its 20-day SMA of $587.20 and 4.8% below its 50-day SMA of $542.27.

The moving average convergence divergence (MACD) indicator remains below its signal line, suggesting buying momentum has weakened.

Traders are watching resistance near $517.50, followed by the 50-day SMA at $542.27. Support stands near $440.50.

Earnings Preview: Wall Street Expects Strong Growth

AMD is scheduled to report third-quarter earnings Nov. 3.

Analysts expect earnings of $1.95 per share, up from $1.20 a year earlier. Revenue is projected to reach $13.08 billion, compared with $9.25 billion last year.

The company continues to expand its AI accelerator business while competing in the data center, PC and gaming markets.

However, AMD trades at a price-to-earnings ratio of 129.6, reflecting high investor expectations for future growth.

Analysts Remain Bullish On AMD

AMD carries a consensus Buy rating, with an average price forecast of $642.55. Recent analyst actions include:

  • Susquehanna: Maintained a Positive rating and raised its price forecast to $620 on Oct. 21.
  • Wedbush: Maintained an Outperform rating and a $600 price forecast on Oct. 20.
  • Citigroup: Maintained a Buy rating and raised its price forecast to $800 on Oct. 6.
Benzinga Edge Rankings Highlight Growth And Valuation Risks

AMD's Benzinga Edge rankings show strong growth, momentum and quality scores but a weak valuation reading.

The stock received a momentum score of 97.93, a growth score of 94.55 and a quality score of 93.33.

However, its value score stood at just 3.75, suggesting investors are paying a premium for the company's growth prospects.

The contrast puts greater pressure on AMD to deliver strong earnings and guidance when it reports results in November.ETFs Offering Exposure To AMD

Investors can gain indirect exposure to AMD through several semiconductor and artificial intelligence-focused exchange-traded funds.

These include iShares Semiconductor ETF (SOXX  ), Defiance Inference AI Chip ETF (AINF  ) and Invesco AI and Next Gen Software ETF (IGPT  ).

These funds provide exposure to AMD alongside other companies benefiting from growing demand for AI infrastructure and semiconductor technology.

AMD Stock Price Action

AMD shares rose 1.80% to $517.05 at the time of publication Friday, according to Benzinga Pro data.