Semiconductor stocks haven’t been immune to retrenchment in the artificial intelligence (AI) trade and sector rotation. Just look at Advanced Micro Devices (AMD), which is off more than 7% since the start of the year. But with its prominence in the AI chip arena, AMD cannot be ignored and aggressive tactical traders may feel the same way about the Direxion Daily AMD Bull 2X Shares (AMUU). The ETF is designed to deliver 200% of the daily performance of the chipmaker’s stock.
Like all leveraged ETFs, AMUU works best over short holding periods. This would be a period of a day or two and when there are clear-cut catalysts for the underlying stock.
Fortunately for traders considering AMUU, AI- and semiconductor-related catalysts abound and some sell-side analysts remain constructive on AMD shares. For example, Deutsche Bank Analyst, Brian Seymore, reiterated a $250 price target on AMD. This implied a 29% increase from where the stock traded entering Monday, following recent meetings with company executives.
AMD Has Ingredients for a Rebound
AMD’s deals with OpenAI and Meta Platforms are key reasons for risk-tolerant traders to keep an eye on AMUU. Those deals are well-known at this point, but they also have the potential to evolve.
“AMD appeared very pleased with MI450 wins and its ability to smoothly execute significant ramps in 2H26+ (we expect some OAI in 3Q26, but with a far larger q/q step up when both OAI and Meta’s semi-custom win ramp in 4Q26),” observed Seymore.
While the deals also involve some warrants, the prevailing belief is that they align with AMD’s shareholders. That could be a relevant piece in a rebound puzzle and another reason for traders to monitor AMUU.
“Beyond the size ($15-20b revenue/ GW, ~$100b in initial 6GW deals), the warrants associated with the OAI and META deals were a key focus of investors, with AMD indicating they were aligned with shareholder interests (trigger on technology, rollout and share price metrics etc.), and expressing that additional equity-related deals were very unlikely,” noted Seymore. “In total, AMD maintained its protocol on not specifically sizing its Instinct revenue overtly, but we remain comfortable with our estimates for ~$15b in 2026 and ~$30b in 2027.”
Then there is AMD’s growth story. It remains intact and serves as a possible springboard for occasional, careful deployment of AMUU.
“The company expects very strong growth in both 2026 and 2027 as share gains continue and the market expands with CPU-intensive agentic AI growth. AMD acknowledged that supply is tight, but highlighted levers it can pull to lessen this headwind (chiplet-related fungibility with DT, node migrations/ optimizations at TSMC etc),” concluded Seymore.
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