Vijay Rakesh from Mizuho Securities reiterated his $13 price target on AMD last week, as he moved estimates on earnings/sales modestly higher considering improved guidance and potential upside in gross margins. Vijay’s stance on profitability makes sense, as we move through the next fiscal year:AMD guided GM in the MarQ up 100 bps q/q, and the company reiterated that it continues to see GM trending towards the LT target of 36-40%. We believe GM will continue to benefit from higher margin Radeon and Vega GPUs into the data center. We believe AMD has now qualified multiple fabs including TSMC and Global Foundries as it ramps in 2017. Increasing contribution from Ryzen for NB/DT, Radeon GPUs in 2H17 should be positive for 2H GM.The upside to gross margins came primarily because of heightened GPU mix, which have higher margins. The revenue upside is still difficult to quantify for Ryzen and Polaris GPUs. I still think there’s upside to my estimates, and the estimates of other analysts in a more optimistic scenario.Here’s Vijay’s take on next quarter earnings/sales:Adjusting estimates, maintaining Buy and PT. We are adjusting our MarQ rev/EPS from $975M/($0.04) to $982M/($0.04), F17E from $4.3B/($0.05) to $4.4B/($0.02), and F18E from $4.8B/$0.14 to $5.0B/$0.26 with higher revenues and GMs. Reiterating our Buy and $13 PT, ~2.4x P/S on 2018E (vs INTC currently at ~2.8x P/S). Overall, I believe his estimate conforms to management guidance, and assuming AMD was conservative on outlook we should anticipate shares to move higher on heightened speculation.I continue to reiterate my positive stance on AMD shares.