10 AI Stocks Hit with New Analyst Ratings

3. Broadcom Inc. (NASDAQ:AVGO)

Number of Hedge Fund Holders: 156

Broadcom Inc. (NASDAQ:AVGO) is one of the 10 AI Stocks Hit with New Analyst Ratings. On August 26, Citigroup reiterated the stock as “Buy” with a $315 price target, stating that it’s bullish on the stock heading into earnings on September 4.

“We expect AVGO to report results above Consensus, driven by continued AI strength.”

Broadcom is set to report fiscal third-quarter earnings after the closing bell on Sep. 4., with Citi anticipating sales to come in above its own estimate of $15.8 billion. This reflects a sequential gain of 6%.

The analysts further noted that Broadcom’s guidance for fourth-quarter sales will probably also come in higher than the estimated $17 billion.

The company is noted to be strengthening its ties to Meta, Alphabet’s Google, and ByteDance, and the “management expects each of these three customers to scale to about one million AI accelerator clusters by 2027.” Not only this, the analysts cited four more prospects including OpenAI, xAI, and Apple in the pipeline.

Despite these positives, the firm did highlight one concern regarding the company. It noted that Broadcom’s higher revenue linked to AI, offering lower margins, will have an impact on its overall gross margins. Nevertheless, it is likely that other area improvements will offset them.

Broadcom’s wireless segment is poised to perform well, while its non-AI semiconductor business is also on the road to recovery.

Broadcom is a technology company uniquely positioned in the AI revolution owing to its custom chip offerings and networking assets.