Bernstein Reaffirms Outperform Rating on Broadcom (AVGO), Keeps $400 PT

Broadcom Inc. (NASDAQ:AVGO) is one of the stocks to buy according to billionaire Ray Dalio’s Bridgewater Associates. On October 8, Bernstein SocGen Group reaffirmed its “Outperform” rating on Broadcom Inc. (NASDAQ:AVGO). The firm also kept the $400 price target for the shares, citing confidence in the company’s future growth path. This decision draws on insights from a virtual meeting with Broadcom’s CEO and CFO, highlighting exceptionally strong compute demand and positive growth prospects.

Bernstein Reaffirms Outperform Rating on Broadcom (AVGO), Keeps $400 PT

The firm noted that frontier large language model (LLM) developers and hyperscalers are experiencing exponentially growing compute needs. This, Bernstein said, is supported by Broadcom’s near-28% revenue growth over the last year and industry-leading gross profit margins of 77.19%. Executives at Broadcom expressed high confidence in hitting a $90 billion revenue target by 2030, saying it is “easily achievable” with just four current customers, and potentially $120 billion with existing relationships. Broadcom CEO Hock Tan affirmed expectations for $10 billion in OpenAI-related revenue in Q3 2026, commenting that additional orders from OpenAI are “highly likely”.

Bernstein anticipates that Broadcom’s robust AI trajectory in 2025 will gather speed through 2026. This will be driven by innovative software products, cash management, superb margins, and free cash flow.

Broadcom Inc. (NASDAQ:AVGO) is a global technology company. It designs, develops, and supplies semiconductor and infrastructure software solutions. Its products span networking, broadband, wireless, storage, and industrial markets.

While we acknowledge the potential of AVGO to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than AVGO and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.