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Now that 2019 has come to a close, investors are looking out to what is in store for 2020. Advanced Micro Devices Inc. (NASDAQ: AMD) was among the best large-cap gainers in 2019 and led the S&P 500 with a gain of 148%. What is even more amazing, after closing out the year at $45.86 per share, is that AMD was trading at $10 back at the start of 2018 and throughout much of 2017.

One analyst sees AMD continuing its surge in 2020. Nomura/Instinet reiterated it with a Buy rating and raised its target price to $58 from $40. While this seems like a monumental change, investors should note that AMD had already jumped well above the so-called fair value line, as its consensus analyst target price from Refinitiv was $37.77 ahead of the call.

David Wong, the Nomura/Instinet analyst behind the call, sees AMD continuing to grow in 2020. With the launch of 7-nanometer processors that are currently smaller than those from rival Intel Corp. (NASDAQ: INTC), AMD is also expected to have new products coming out in 2020. Wong also believes that AMD will grow its market share for desktop processors from 18% in the third quarter of 2018 up to a range of 20% to 25%.

One additional driving force for AMD also will come from the video game console refresh cycles for the Xbox and PlayStation due just in time for the holidays in 2020.

One issue often brought up is that AMD’s valuations are harder to use than some rivals due to a multiyear history of the stock underperforming. AMD is now valued at $56 billion, and even a $47 share price would imply valuations of 40 times expected 2020 earnings per share. AMD is expected to grow revenues by about 27% to $8.5 billion in 2020 and that would value it at about 6.5 times revenues. The much larger Intel is valued at less than 13 times expected 2020 earnings per share, but it has very muted growth expectations, and its market cap of $264 billion values the processor giant at only about 3.7 times revenues.

Most analyst calls with Buy and Outperform ratings tend to come with upside projections of 8% or so at this stage of the decade-long bull market and economic expansion. This call for AMD projects more than 26% upside from AMD’s end of year closing price.

Investors have greeted the target hike with continued optimism for 2020. AMD shares were last seen trading up over 4% at $47.87, and the stock’s new 52-week trading range is $16.94 to $47.99.

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