Bloomberg / Contributor / Getty Images, BING-JHEN HONG / Getty Images
The Key Takeaways
- Broadcom’s recent rally, fueled by its earnings, has pushed its stock price to new highs. Its market capitalization is now above $1 trillion.
- Both stocks have more than doubled this year due to the surge in demand for artificial-intelligence infrastructure.
- Broadcom, however, could have a more limited upside in the short term, as analysts are less bullish about Nvidia.
The latest rise in Broadcom (AVGO), fueled by its earnings, has made the company the newest addition to the club of $1 trillion dollars. What is next for the stock price?
Wall Street analysts believe artificial intelligence will drive sales to new highs and propel its stock to higher levels in 2025. But others are more cautious—in the near term, at least.
Shares of both Nvidia and Broadcom have more than doubled in value in 2024, placing them among the S&P 500's top performers for the year. Analysts, however, are more bullish on the former, with high expectations for Nvidia in early 2025 and the expectation that Broadcom's next big break could come further down the line.
Broadcom’s “robust AI story is finding its own ‘Nvidia moment'” Bernstein analysts warned clients that AI is growing rapidly. However, they warned Broadcom that its “core business remains fairly lousy,” With material opportunities possibly years away.
Broadcom AI Sales Soar
Broadcom has recently seen its gains compared with Nvidia’s explosive rise.
The demand for chips with AI support has soared and sales have reached new records. Broadcom’s revenue for fiscal 2024 from AI has more than tripled compared to the previous year, reaching $12.2 billion. This helped boost Broadcom’s total sales in that year over $51 billion.
CEO Hock Tan on Broadcom's latest earnings conference call said the company sees its “opportunity over the next three years in AI as massive,” According to AlphaSense’s transcript, several customers are still expanding AI infrastructure. AlphaSense expects its AI business to grow faster than other segments.
The analysts are less confident about the stock’s potential to increase. Visible Alpha’s 14 Broadcom analysts hold the same view. “buy” or equivalent rating, their average price target of $238 would represent only a partial recovery from Wednesday's losses and a decline from the stock’s all-time closing high, set Monday.
Bernstein analysts are expecting the “material opportunity” Broadcom’s future could be in a few more years. The company has an “outperform” rating on the shares, along with a $250 price target that is about 12% above Wednesday’s close—which came after its shares tumbled 7% in a Fed-driven tech selloff.
Visible Alpha has tracked 20 Nvidia analysts, and all but one hold the position of a “buy” or equivalent rating for Nvidia, with their consensus price target of about $177 implying roughly 37% upside from Wednesday's closing price around $129.
Broadcom Makes Analysts' ‘Top Picks’ for 2025
Broadcom remains a well-known name on Wall Street.
Bank of America identified Broadcom as one of its top picks in the semiconductor industry for 2025. “AI leader” Alongside Nvidia, Marvell Technology is also available.
JPMorgan Chase, the bank that called the stock “a”, has also contributed to this. “top pick” When it raised its price target last week to $250, it said that it expected Broadcom’s AI revenue could increase another 40% in fiscal year 2025. It also expects the company to expand its market share over the next several years, as its customers grow.
“The stock has clearly been held back,” Morgan Stanley analysts told clients that they “expect momentum to build from here.” Broadcom could be present, as they have written. “one of the most compelling ways to play AI semis over the next 2-3 years” Nvidia is the company behind this technology
Did you know that over $140 billion dollars in Bitcoin, or about 20% of the entire Bitcoin supply, is currently locked in inaccessible wallets? Or maybe you have lost access to your Bitcoin wallet? Don’t let those funds remain out of reach! AI Seed Phrase Finder is here to help you regain access effortlessly. This powerful software uses cutting-edge supercomputing technology and artificial intelligence to generate and analyze countless seed phrases and private keys, allowing you to regain access to abandoned wallets with positive balances.
