Bernstein raises Broadcom stock price target to $400 on AI strength

Investing.com - Bernstein analyst raised the price target on Broadcom (NASDAQ:AVGO) stock to $400 from $295 while maintaining an Outperform rating, citing strong artificial intelligence semiconductor performance. The new target represents potential upside from the current price of $306.1, with InvestingPro data showing the stock trading near its 52-week high of $317.35.

Broadcom reported fiscal third-quarter 2025 earnings of $1.69 per share on revenue of $16 billion, exceeding analyst expectations of $1.67 per share on $15.8 billion in revenue. Both the semiconductor and software segments performed better than anticipated. The company maintains impressive gross profit margins of 77.2% and has achieved revenue growth of 28% over the last twelve months.

The company’s AI semiconductor revenues reached approximately $5.2 billion, representing a year-over-year increase of about 63% and surpassing market expectations, while non-AI semiconductor segments continue to recover slowly.

Bernstein noted that CEO Hock Tan’s contract renewal through 2030 suggests strong future prospects for the company, with the firm expecting "numbers are going to go up materially with potential room for further upside."

The new $400 price target is based on approximately 35 times price-to-forward earnings on fiscal years 2026/2027 average earnings per share of $11.38, up from the previous estimate of 33 times $8.70.

In other recent news, Broadcom has seen several analysts revise their price targets for the company following its latest financial performance and strategic developments. Rosenblatt raised its price target to $400, maintaining a Buy rating, after Broadcom’s quarterly results demonstrated a "strong beat-and-raise quarter" with significant market share gains. Similarly, JPMorgan also increased its price target to $400, highlighting Broadcom’s leadership in various technology segments. Baird adjusted its price target to $300, acknowledging Broadcom’s "impressive execution" and a substantial order from OpenAI expected in 2026.

Deutsche Bank set a new price target of $350, citing stronger-than-expected growth prospects in artificial intelligence, noting Broadcom’s bullish commentary in this area. Mizuho raised its price target to $355, following Broadcom’s in-line July quarter results and October quarter guidance, which surpassed consensus estimates. These developments reflect a positive outlook from multiple financial institutions on Broadcom’s performance and future potential.

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