Broadcom Is Set To Rewrite The AI Narrative

Broadcom Inc. remains a Buy, with fundamentals strong despite recent price underperformance versus the S&P 500. AVGO's Q2 results validated growth assumptions: $22.19B revenue (+48% YoY), record 67.3% EBIT margin, and robust AI-driven custom silicon pipeline. AI partnerships with hyperscalers (Google, Meta, Anthropic, OpenAI) and dominant Ethernet switching position underpin multi-year growth visibility. Valuation is compelling at 20x FY2027 EPS and PEG below 0.30x; price target raised to $585.90, implying nearly 50% upside.

In my previous article on Broadcom Inc. ( AVGO ), I assumed that AVGO’s dominant XPU and Ethernet networking positions seemed to be heavily underappreciated by Wall Street.