Robert W. Baird analyst Tristan Gerra has maintained their bullish stance on AVGO stock, giving a Buy rating today.
Tristan Gerra has given his Buy rating due to a combination of factors surrounding Broadcom’s robust positioning in the AI and networking sectors. Gerra highlights the company’s extensive portfolio that not only maintains its leadership in networking technology and market share but also boasts a solid footing in artificial intelligence. This extends beyond its custom ASIC business, which has recently announced a significant third iteration. Broadcom’s comprehensive suite of technologies is lauded for filling key niches in AI networking, which contributes to its market dominance and allows it to enjoy margins above the industry average.
Gerra’s confidence in Broadcom is reflected in his $1,500 price target, anchored by a forward-looking earnings multiple that surpasses that of its peers. The applied multiple of approximately 27 times the fiscal year 2024 earnings estimate is justified by the strong growth prospects in Broadcom’s custom ASIC segment for AI applications. While acknowledging the inherent risks related to market concentration, technology cycles, and potential strategic missteps, Gerra’s outlook remains optimistic about Broadcom’s growth trajectory and its ability to sustain high profitability.
Gerra covers the Technology sector, focusing on stocks such as Broadcom, Diodes, and Himax Technologies. According to TipRanks, Gerra has an average return of 8.5% and a 51.92% success rate on recommended stocks.
In another report released today, Bernstein also assigned a Buy rating to the stock with a $1,600.00 price target.
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Broadcom (AVGO) Company Description:
Broadcom, Inc. is a technology company offering semiconductor and infrastructure software solutions. It operates through two segments: Semiconductor Solutions (includes semiconductor solution product lines and IP licensing) and Infrastructure Software (Includes mainframe, BizOps and cyber security software solutions and FC SAN business). The company was founded in 1961 and is headquartered in San Jose, CA.
