Chipmakers were among Wall Street's favorites in 2023 as their hardware is crucial to countless industries. And as interest in artificial intelligence (AI) soared, so did demand for graphics processing units (GPUs) -- the powerful chips necessary for training and running AI models. That propelled skyrocketing valuations for chip stocks like Advanced Micro Devices (NASDAQ: AMD), which climbed by 128% over the last 12 months.

AMD has ramped up its expansion into AI as it prepares to challenge Nvidia's overwhelming dominance in that market in 2024. Meanwhile, its diverse business gives it solid positions in several other high-growth niches. As a result, there are plenty of reasons to be bullish about AMD's future.

However, before you jump into its stock, it would be wise to consider both the positives and potential negatives. So here are two reasons to buy AMD and one reason to sell.

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Source Fool.com