Shares of Advanced Micro Devices jumped 7% on Monday after a pair of Wall Street analysts issued positive notes about the company’s new line of microchips.
AMD’s stock (AMD) rose $0.98 to $14.47 in midday trading. The stock, which quadrupled last year, had fallen from a 10-year high of $15.55 at the end of February over concerns about slow early sales of its new chips.
But those short-term worries are unfounded because of CEO Lisa Su’s strategy of offering comparable or better performance with competing Intel chips at a fraction of Intel’s prices, Jeffries analyst Mark Lipacis wrote on Monday in a note. He raised his target price on AMD to $16 from $13.
Get Data Sheet, Fortune’s technology newsletter.
Intel has captured close to 95% market share in chips for desktops, laptops, and servers, but now AMD is poised to recapture some of that share. If AMD reaches 5% market share in all three segments, it could generate as much as $1.5 billion of additional revenue over the next few years, Lipacis forecast. Hitting 15% in the three markets could add as much as $4.6 billion. That’s more than the $4.3 billion AMD brought in for all of last year.
“We have argued that AMD is in the early innings of its multi-year turnaround story, a strategy being executed upon by its new CEO,” the analyst wrote. “We think AMD’s ability to price between-the-seams while achieving competitive performance will result in meaningful share gains from (Intel) in the desktop, server, and notebook markets starting in 2017.”
Wall Street and investors have been growing increasingly concerned about the mounting competition for Intel. Its shares have dropped 2% so far in 2017, while the S&P 500 Index has gained 6%.
Still, sales of AMD’s desktop-oriented Ryzen 7 chips, released in early March, have been held back by shortages of related parts like compatible motherboards, Susquehanna analyst Christopher Rolland noted in a report on Monday. And while a few lesser PC makers have begun selling PCs with Ryzen chips, the heavy hitters like Dell and HP (HPQ) won’t offer AMD-laden systems until next month at the earliest, Rolland said.
“We identified a few smaller PC makers that are selling Ryzen desktops, however, we believe they are just purchasing standalone processors and putting them inside pre-assembled PCs,” Rolland wrote. “No major PC OEM (HP, Lenovo, Dell, Asus) is currently selling Ryzen desktops. We estimate sales will begin in April.”