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On Friday, Rosenblatt analysts raised the price target for Broadcom Limited stock (NASDAQ:AVGO) to $340 from $223, maintaining a Buy rating. With a market capitalization of $1.22 trillion and an impressive gross profit margin of 76.26%, the semiconductor giant continues to show strong momentum. This adjustment follows Broadcom’s recent quarterly report, which showed a 46% quarter-over-quarter increase in AI revenue. The company has projected a 60% year-over-year growth in this segment.
Broadcom’s management highlighted the adoption of its Ethernet products, which are key for scaling-up connectivity. This scale-up is reportedly 5 to 10 times higher in unit volumes compared to scale-out, which is crucial for large language model (LLM) training and inference applications. According to InvestingPro data, the company’s overall revenue growth stands at 40.3%, reflecting strong market penetration.
The company has three hyperscale customers currently ramping up production and is in discussions with four additional XPU prospects. Rosenblatt analysts noted Broadcom’s strong custom ASIC capabilities as a reason for their continued recommendation of the stock. While trading at a relatively high P/E ratio of 116.5, InvestingPro analysis indicates the stock is currently overvalued, with 20+ additional insights available to subscribers.
Broadcom’s management expressed confidence in sustaining the current growth rate into 2026, benefiting from good visibility with its three XPU customers. With an overall Financial Health Score of "GREAT" and strong growth metrics, the analysts’ revised price target reflects these positive growth prospects.
In other recent news, Broadcom Limited has been the focus of several analyst updates following its latest earnings report. The company reported mixed results with strong performance in its AI segment, accounting for 29% of its fiscal second-quarter 2025 sales, but faced challenges with lower margins. Citi analysts raised their price target for Broadcom to $285, citing expected growth in the AI sector. Similarly, BofA Securities increased their price target to $300, noting the company’s upgraded AI outlook and stronger deployments of compute for inference.
JPMorgan analysts also raised their price target to $325, following a favorable patent ruling that could extend market exclusivity for a drug associated with Broadcom. UBS analysts adjusted their price target to $290, based on bullish AI demand and potential revenue growth for 2026. Mizuho (NYSE:MFG) analysts set their price target at $310, highlighting Broadcom’s guidance for AI revenue growth and the launch of Tomahawk 6, which is expected to enhance AI cluster capabilities.
Broadcom’s financial outlook remains robust, with guidance for the July quarter slightly above consensus and expected acceleration in AI demand. The company anticipates AI semiconductor revenue to grow by more than 60% year-over-year in the second half of fiscal year 2026. Despite some near-term challenges, analysts maintain a positive outlook on Broadcom’s strategic opportunities and growth potential in the AI sector.
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