Truist analyst William Stein recommended buying a chip stock other than Nvidia, but Advanced Micro Devices (AMD).

After posting solid quarterly earnings, Stein changed his rating on the chipmaker from Hold to Buy and raised his price target to $213 from $173, an increase of more than 30% at Monday's close.

It's clear that the semiconductor industry is booming following the continued development of artificial intelligence.

In this context, the expert asserted that AMD is currently an alternative to Nvidia at the enterprise level and also in the bets of retail investors.

“Over the past month or so, contacts have increasingly noted that hyperscalers are working with AMD in a partnership, expressing real interest in deploying AMD on a large scale,” the analyst said.

The Key to a Chip Stock's Soaring

Stein highlighted an important point: Until 2018, AMD held less than 1% of the CPU market share. However, over the years, it has managed to overtake Intel, a direct rival.

Intel has recently experienced difficulties in its manufacturing process and product design, something that AMD has taken advantage of to gain the market share it needed to grow.

AMD's future looks promising, as of the 53 analysts covering the stock, 36 rate it as a buy or strong buy.

On the other hand, the company's shares jumped 2.3% on Tuesday to $167, accumulating a gain of more than 38% so far this year.