Less than two weeks out from earnings, Advanced Micro Devices, Inc. (NASDAQ:AMD) sits in an interesting spot. AMD stock sits not far from its highest levels in a decade. A big rally (AMD is up over 60% this year) has come without a lot of news. Rather, investors simply seem more optimistic toward the company, particularly newer lines like Ryzen and EPYC.

But AMD skeptics are out there as well. The average analyst target price for the stock is just below $15, suggesting 10% downside from current levels.

Between a reasonably high valuation from an earnings standpoint, and the presence of real risks going forward, there is a case for taking profits.

I don’t necessarily agree with that case: I argued last month that AMD stock had more room to run. Even with the stock up another 10%, I still think that’s the case. But Josh Enomoto has called for caution, and there is a case for taking profits. AMD trades at 22x its 2020 EPS target. PCs and laptops remain the largest end markets here and provide little in the way of market growth.

The bull/bear split and a reasonably high valuation seem to set up a rather important stretch for Advanced Micro Devices. If AMD can convince the bears of its growth potential, there’s more upside to come.

If it disappoints bulls, a pullback toward the low double-digits isn’t out of question. How that plays out likely will come down how AMD answers these three questions.

Question #1: Can AMD Stock Survive a Trade War?

Trading in the chip space of late has been a more magnified version of the market as a whole. Trade war concerns send stocks lower; optimism toward the current business leads investors to buy on the dip. The choppy trading in the S&P 500 of late has been mirrored on a more volatile basis by the SOX (Philadelphia Semiconductor Index).

Indeed, as I write this, AMD stock is down 1.5%, and rival Nvidia  (NASDAQ:NVDA) off over 2%, due to retaliatory tariffs. And make no mistake, Advanced Micro Devices is one of the stocks most at risk from a trade war.

After all, China (including Taiwan) is the company’s largest market, driving nearly one-third of 2017 revenue. And the region accounted for more than half of the company’s revenue growth last year.

Import tariffs could drive up costs. But they may also harden China’s resolve to build a chip business of its own as part of its “Made in China 2025” strategy.

AMD isn’t going to get wiped out by a trade war. And just like with Apple (NASDAQ:AAPL) or Intel or even Caterpillar (NYSE:CAT), investors need to formulate their own opinions as to what the long-term macro effects of higher tariffs might be.

But any disruptions on that front could both overshadow near-term improvements and create a long-term headwind.

Question #2: What Is The ‘Real’ Impact of Cryptocurrency?

For both NVDA and AMD, skeptics have argued that cryptocurrency has provided a boost to revenue of late. And with bitcoin back toward $6,000, the bearish argument is that the tailwind of last year will reverse to a headwind this year.

AMD has said that crypto revenue accounts for 5-10% of total sales. And weaker demand on that front is one reason why second-half revenue is guided roughly flat.

That said, even some bulls (see this excellent article, for instance) have argued that AMD may be underestimating the tailwind. And particularly in Q3 and Q4, it’s not hard to imagine headlines reading “Advanced Micro Devices misses revenue estimates on lower mining demand”. Long-term, crypto demand will work itself out.

In the meantime, AMD needs to prove that its recent growth is sustainable.

Question #3: How Much Market Share?

This is the key question for AMD stock right now. How much market share can it take? PCs and laptops aren’t exactly growth markets. Intel has had a stranglehold on data center, but Nvidia is making its own push with a great deal of success.

The company certainly has an opportunity right now. Intel’s CEO has stepped down. Gaming demand is hot, with the Sony (NYSE:SNE) PlayStation bouncing back nicely and helping GPU sales. Ryzen CPUs and EPYC data center chips represent AMD’s most competitive offerings in years.

It’s not quite “now or never” for Advanced Micro Devices but this does feel like a key stretch. If AMD can drive growth by taking share and protecting margins in the process the long-term case here becomes much, much stronger. If not, it gets dicey.

The Vega GPU got off to a poor start and has struggled since its launch. The Ryzen launch is being lapped in the second half. EPYC is facing two tough rivals.

If AMD can show some big wins over the next few quarters, then it looks like a real player in the space and the stock likely re-rates higher. If Ryzen sales slow, however, and datacenter progress is minimal, there’s not much left in terms of growth drivers.

Suddenly, this starts to look a bit like the “same old” AMD stock, simply not quite good enough to compete with the big boys. That’s the decision investors will be making over the next few quarters and that’s what investors are betting on right now.

As of this writing, Vince Martin has no positions in any securities mentioned.