Stifel has named its leading processor stock picks as companies prepare to report results in the June and July earnings window, focusing on names positioned to capture growth tied to artificial intelligence infrastructure spending.
Firmwide view and market backdrop
In its sector review, Stifel emphasizes companies with clear catalysts and valuations it finds appealing amid an ongoing buildout of AI infrastructure. The firm frames the current environment as one where compute capacity is tight and demand is broadening beyond traditional hyperscalers to include AI cloud providers, enterprises and sovereign buyers. As a result, Stifel characterizes the situation as more supply-constrained than demand-constrained.
1. NVIDIA (NVDA) - Stifel's preferred large-cap processor holding
Stifel identifies NVIDIA as its preferred large-cap processor stock heading into the upcoming reporting period. The firm points to continued strength in Blackwell and the presence of early orders for Vera Rubin extending into the third fiscal quarter as supporting near-term momentum. Stifel also notes that company management has addressed investor concerns about timing in recent conference remarks.
On valuation, Stifel highlights that the stock trades at about 25 times fiscal year 2028 estimates, which the firm regards as an attractive multiple given the demand dynamics described. Recent company developments include an announcement that AI startup Perplexity will deploy NVIDIA's new Vera central processing units, from which NVIDIA expects to generate $20 billion in sales this fiscal year. In addition, Morgan Stanley and TD Cowen have reiterated positive ratings on the company, which Stifel cites as consistent with a strong and diversifying growth outlook.
2. AMD - Stifel's other preferred exposure to accelerated computing
Stifel also highlights Advanced Micro Devices as a preferred way to access accelerated-computing trends. The firm points to AMD's core EPYC server-CPU franchise as increasingly benefitting from AI demand, and references a total addressable market for the opportunity expected to exceed $120 billion by 2030, with a compound annual growth rate above 35 percent.
Company-specific catalysts called out by Stifel include the anticipated second-half cadence for MI450 and Helios products, along with early visibility on MI500. The firm also cites two 6-gigawatt commitments involving OpenAI and Meta as supporting evidence of customer traction. Stifel notes that AMD experienced an approximate 8 percent pullback on July 7 alone, a move the firm believes reset market expectations around the MI450 ramp. Finally, Stifel views the company’s July 23 "Advancing AI" event as a potential catalyst ahead of earnings.
Recent analyst activity for AMD
Advanced Micro Devices recently saw Wells Fargo raise its price target while maintaining an Overweight rating, with the firm increasing its server CPU revenue estimates. Separately, William Blair initiated coverage on the stock with a Market Perform rating, describing AMD as a major beneficiary of the AI infrastructure expansion.
Investment implications
Stifel's selections focus on companies it views as having specific product catalysts and attractive valuations as AI-related compute demand spreads across multiple end markets. The firm’s analysis underscores supply tightness in compute capacity and highlights company-specific milestones that could influence near-term earnings outcomes.