20 Best AI Stocks to Buy According to Analysts

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11. Broadcom Inc. (NASDAQ:AVGO)

Analyst Upside: 41.69%

Number of Hedge Fund Holders: 183

Broadcom Inc. (NASDAQ:AVGO) ranks among the best AI stocks to buy according to analysts. Citing robust development in the AI semiconductor industry, Benchmark increased its price target for Broadcom Inc. (NASDAQ:AVGO) from $385 to $485 on December 12, retaining a Buy rating on the company’s shares. According to Broadcom Inc. (NASDAQ:AVGO), its AI semiconductor division achieved $6.5 billion in Q4, improving 76% year-over-year and 25% sequentially.

The company reported $21 billion in orders from Anthropic over the last two quarters, while its six-quarter AI order backlog climbed to $73 billion. Broadcom’s list of clients now includes giants like Meta, ByteDance, and Google, as well as an additional contract with OpenAI to supply $1 billion in chips by late 2026.

According to Reuters, while Broadcom’s backlog is scheduled to ship over the next 18 months, CFO Kirsten Spears warned that margins could fall. She stated that the Q1 consolidated gross margin is likely to fall roughly 100 basis points sequentially, owing to a higher percentage of AI revenue.

Analysts quoted by Reuters emphasize two main risks for the company, including its excessive concentration on just five AI customers, and weaker margins on AI systems, which are likely to account for a greater share of the total revenue in coming quarters, notably in the second half of fiscal year 2026.

Broadcom Inc. (NASDAQ:AVGO) designs, develops, and supplies various semiconductor devices and infrastructure software solutions worldwide. The company operates in two segments: Semiconductor Solutions and Infrastructure Software.

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