Advanced Micro Devices (NASDAQ:AMD) stock has made a stunning recovery in 2019. Shares of the chipmaker have nearly doubled this year after a muted start, making it one of the top growth stocks on the market. But if you have been holding off on this stock, it could be a bad idea to stay on the sidelines, as AMD looks primed to deliver more upside in 2020.

Let's take a look at the reasons why this hot tech stock is on track to make investors richer in the coming year.

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Regaining its mojo

AMD was in trouble a year ago thanks to an oversupply of graphics cards in the wake of the cryptocurrency mining bust. But it has managed to stage a terrific comeback as evident from the company's latest quarterly results.

AMD's revenue was up 9% year over year in the recently reported third quarter, while non-GAAP (adjusted) earnings per share jumped 38.5%. The results were mixed from a Wall Street point of view, as the massive revenue jump of 36% witnessed in the computing and graphics segment was offset by an annual decline of 27% in the enterprise, embedded, and semi-custom business.

AMD admits that its semi-custom business will take another knock in the fiscal fourth quarter, as the likes of Sony and Microsoft bring the curtains down on their current-generation video gaming consoles. Despite this headwind, AMD estimates that its fourth-quarter revenue is on track to increase a whopping 48% year over year to $2.1 billion.

AMD believes that the strength of its computing and graphics segment will be enough to offset the weakness in the semi-custom business, which accounted for 29% of revenue last quarter. That's because AMD seems to be winning market share from key rivals Intel (NASDAQ:INTC) and NVIDIA (NASDAQ:NVDA) in graphics cards and processors.

For instance, Advanced Micro's Ryzen CPUs (central processing units) are already in strong demand, helping AMD achieve its highest quarterly revenue from the client processor business in eight years. AMD says that the company has gained market share in the CPU market for eight quarters on the trot, and it is not difficult to see why.

Similarly, AMD has been eating into Intel's data center dominance as well. Mercury Research estimates that the chipmaker's data center market share increased 1 percentage point in the third quarter to 5.1%. What's more, Nomura Instinet analyst David Wong is of the opinion that AMD could double its data center market share by the middle of 2020.

A similar story is unfolding in the graphics card market. AMD has eaten into market leader NVIDIA's share for three consecutive quarters, driven by the former's strategy of delivering well-equipped graphics cards at affordable prices. As such, it is not surprising to see why AMD is confident of closing the year on a high despite a slowdown in another part of its business.

All cylinders will be on fire next year

AMD should continue to eat into the market share of its rivals next year. For instance, Intel will continue to face the heat from AMD as the latter's chip manufacturing process puts it a year ahead of Chipzilla. AMD has already launched its suite of 7-nanometer (nm) chips, giving it an advantage over Intel, which is facing CPU shortages and has finally managed to transition to 10-nm chips after long delays. So customers are likely to opt for AMD's chips given its technology lead over Intel.

But more importantly, AMD's semi-custom business should step on the gas next year as Microsoft and Sony come out with their next-generation consoles. AMD will be supplying processors for both consoles, unlocking a huge opportunity that its archrival NVIDIA is going to miss out on.

As such, AMD investors can expect the company to fire on all cylinders next year once the semi-custom business starts gathering pace driven by the ramp-up of the next PlayStation and Xbox consoles. This is probably the reason why Yahoo! Finance analysts are expecting a huge bump in AMD's top and bottom lines in fiscal 2020.

Finally, AMD stock trades at 35 times forward earnings, which is well below its five-year average forward price-to-earnings multiple of nearly 76. Given the potential growth on offer, buying AMD right now seems like a good idea even though the stock has nearly doubled in 2019.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.