Quick Read
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AVGO’s AI semiconductor revenue surged 221% YoY to $17B, yet the stock trades near its 52-week low at just 18x forward earnings.
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Tan said Broadcom is “on target to exceed $30 in earnings per share in fiscal 2028,” making a $600 share price just 20x earnings.
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Just released. Our analysts combed the entire stock market and named the ten best stocks to buy right now, and Broadcom didn’t make the cut. Enter your email to see the names that beat AVGO. The report is free. Enter your email and see if any of your stocks made the cut.
Broadcom (NASDAQ:AVGO) is building custom AI chips for the biggest frontier labs, and the business is growing at a pace that is hard to match. Last quarter, AI semiconductor revenue reached $16.70B, +221% YoY, and total revenue rose 85.5% to $29.591B.
Chief executive Hock Tan said “Demand for our custom AI accelerators and networking continues to be very strong.” The stock is still down 3.6% year to date at $326.08. Can Broadcom hit $600 by 2028?
What’s Holding Broadcom Back Right Now
Shares traded at $495 when Broadcom reported in June and at $371.27 when it reported in September. Over the past month the stock lost 5.52%, though it recovered 3.15% in the past week. I see three concerns behind the slide.
First, gross margin is guided down to roughly 73% in Q4 from 75% as memory-heavy XPUs take up more of the mix.
Second, revenue depends more and more on a small group of AI customers. Third, funding those customers now leans on structures like the $35 billion first portion of Broadcom’s XPV platform.
Big funds were already pulling back: of 19 tracked filers, 10 cut their stakes in Q2 and only 6 added. A beta of 1.476 means the stock moves harder than the market in both directions.
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Wall Street Sees 62.6% Upside. My Model Says 24.3%
The consensus target of $530.14 implies 62.6% upside. Analyst ratings break down to 7 strong buys, 40 buys, 3 holds, with no sell ratings. My base case targets $405.37, or 24.32% upside, inside a 12-month range that runs from $361.78 to $534.37. My model’s confidence score for that range is high, at 0.9.
