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On Friday, Bernstein SocGen Group analysts raised the price target for Broadcom Limited (NASDAQ: NASDAQ:AVGO) stock to $295 from $250 while maintaining an Outperform rating. The adjustment follows Broadcom’s fiscal second-quarter 2025 earnings report, which showed strong performance in both its semiconductor and software divisions. According to InvestingPro data, Broadcom currently trades at a P/E ratio of 113.2 and maintains a "GREAT" overall financial health score, with particularly strong momentum metrics.
Broadcom reported quarterly earnings of $15.0 billion, meeting analysts’ expectations, with semiconductor sales at $8.4 billion and software revenue at $6.6 billion. The company’s artificial intelligence segment is projected to continue its growth, with anticipated AI sales for next year around $30 billion, exceeding current consensus estimates by $4-5 billion. InvestingPro analysis reveals impressive gross profit margins of 76.3% and strong revenue growth of 40.3% over the last twelve months. Get access to 20+ additional ProTips and comprehensive valuation metrics with InvestingPro.
Despite the positive earnings report, Broadcom’s stock experienced a slight decline in aftermarket trading, attributed to high expectations leading into the earnings announcement. Analysts noted that the AI segment’s growth potential more than compensates for any ongoing weakness in the core semiconductor business.
Additionally, Broadcom’s VMware division continues to show strong growth prospects, contributing positively to the company’s overall performance. Analysts from Bernstein SocGen Group expressed confidence in Broadcom’s future, citing a robust engagement pipeline and the strengthening AI narrative.
The raised price target reflects Bernstein SocGen’s updated valuation, based on an average earnings per share of $8.70 for fiscal years 2026 and 2027, maintaining a price-to-earnings ratio of approximately 33 times.
In other recent news, Broadcom Limited has seen several adjustments to its stock price targets by various analyst firms, all citing growth in the company’s artificial intelligence (AI) sector. TD Cowen raised Broadcom’s stock price target to $290, highlighting a slight beat in earnings and strong AI sales projections for the fiscal year 2026. Rosenblatt increased the target to $340, pointing to a significant 46% quarter-over-quarter increase in AI revenue and the adoption of Broadcom’s Ethernet products for large-scale applications. Citi analysts adjusted their target to $285, noting strong AI segment performance despite challenges with lower margins due to a higher semiconductor mix.
BofA Securities also raised their price target to $300, driven by Broadcom’s improved AI outlook, projecting a 60% year-over-year growth. This adjustment reflects stronger deployments in computing for inference. Meanwhile, JPMorgan set a new target of $325 following a favorable patent ruling for Acadia Pharmaceuticals, which could impact Broadcom’s market position. These developments underscore Broadcom’s strategic focus on AI growth, with analysts maintaining a positive outlook on the company’s potential in this sector.
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