Broadcom stock price target raised to $480 by Jefferies on AI growth

Investing.com - Jefferies raised its price target on Broadcom Limited (NASDAQ:AVGO) to $480.00 from $415.00 while maintaining a Buy rating, citing the company’s artificial intelligence ASIC business as a key growth driver. This target matches the highest analyst price objective for Broadcom, which has delivered an impressive 117% return over the past year. According to InvestingPro data, the stock is currently trading near its 52-week high of $386.48.

The investment firm named Broadcom as its top pick, pointing to potential upside in estimates as the company’s Application-Specific Integrated Circuits (ASICs) business reaches an inflection point. Google, Broadcom’s main ASIC customer, has increased its token processing from 480 trillion in April 2025 to 1,300 trillion in October. This growth aligns with Broadcom’s strong overall revenue growth of 28% in the last twelve months, with analysts expecting net income to continue growing this year.

Industry checks suggest Google’s Tensor Processing Unit (TPU) volumes could reach 3 million units for 2026, up from 1.5 million in 2025. This growth is partly driven by Google’s plans to host access for up to 1 million TPUs for Anthropic, which is also establishing its own cluster expected in 2026. Broadcom’s impressive gross profit margin of 77.2% positions it to capitalize significantly on this volume growth.

Jefferies noted that Anthropic’s previously announced $10 billion deal with Broadcom represents just the initial order of approximately 250,000 units, with follow-on orders anticipated. The firm expects this relationship to drive significant revenue growth for Broadcom. With a market capitalization of $1.71 trillion and an overall financial health score rated as "GREAT" by InvestingPro, Broadcom appears well-positioned to execute on these opportunities. InvestingPro offers 18 additional tips and comprehensive Pro Research Reports on Broadcom, providing deeper insights into what really matters for investors considering this semiconductor giant.

Beyond Google and Anthropic, Jefferies expects Meta to begin ramping up production of its first AI chip with High Bandwidth Memory (HBM) in the third quarter of 2026, followed by an OpenAI ASIC in the fourth quarter, further diversifying Broadcom’s customer base in the AI chip market. Broadcom is currently trading above its InvestingPro Fair Value, reflecting the market’s high expectations for these AI-driven growth opportunities.

In other recent news, Broadcom has made several significant announcements and received multiple analyst upgrades. The company recently unveiled the Thor Ultra, the industry’s first 800G AI Ethernet Network Interface Card, designed to enhance AI workload connectivity. In terms of financial projections, Mizuho has increased its price target for Broadcom to $435, citing a new partnership with Anthropic, which is expected to generate substantial revenue by 2026. Evercore ISI also raised its price target to $403, following a deal with OpenAI to deploy custom AI accelerators, projected to impact earnings per share positively by 2029.

Additionally, UBS has adjusted its price target to $415, influenced by rising AI demand and recent developments with OpenAI. Oppenheimer reiterated its Outperform rating, maintaining a price target of $360, after Broadcom’s strategic partnership with OpenAI for a 10GW DC infrastructure project. These developments suggest a growing focus on AI technologies and partnerships, which analysts from firms like Mizuho, Evercore ISI, UBS, and Oppenheimer believe could drive Broadcom’s future revenue and earnings.

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