The rebound in Advanced Micro Devices, Inc. (NASDAQ:AMD) is one heck of a story. Just one year ago the stock was trading below $2 and appeared to be on the brink of extinction. Then, suddenly, it turned itself around. Now AMD stock has powered through $15 for the first time since 2007.

This sort of parabolic momentum was commonplace for tech companies back in the late 1990s — AMD experienced similar spikes in 1999-2000 and 2003-05, each followed by a crash in the years ahead — but this is a very rare occurrence in today’s environment.

AMD stock is up more than 600% in the last year, with new products primarily driving the growth. However, you also have to keep fundamentals in mind, and I believe there is reason to be cautious here.

While Advanced Micro Devices is set to once again report positive earnings in 2017 and even more robust growth in the coming years, there’s no question that AMD stock is overvalued.

Looking ahead to 2020, the 20 analysts currently covering this stock anticipate earnings will grow to 60 cents per share. A 25X multiple on that expectation would put AMD at $15, which isn’t far from where it’s trading today. And based on 2017 EPS expectations of 6 cents, the shares currently boast a forward price-to-earnings ratio of 237.

AMD Stock Charts

Speaking from a pure technical standpoint, AMD has been one of the best stocks in the market over the last year with its methodical series of higher highs and higher lows.

However, today the stock is overbought and due for a near-term pullback.

If the trend were to continue, AMD stock would pull back and successfully test support around $12.60. On the other hand, a break below that level would compromise the uptrend.

As a result, I wouldn’t be a buyer at current levels.

But if we do see some near-term weakness and a bounce off $12.60, AMD could be a buy around $13 for a purely technical swing trade.