We recently published 10 Stock News You Can’t Miss As Investors Watch AI Trade Momentum. Broadcom Inc (NASDAQ:AVGO) is one of the stock news you can’t miss.
On March 3, 2023, Stephanie Link from Hightower commented on Broadcom Inc (NASDAQ:AVGO) quarterly results and said the stock is cheap. Here is what the analyst said at the time:
“If we take any cues from Nvidia we know that their quarter actually wasn’t that good but the guidance was good for Data Center and Ai and that is 30 of broadcom’s total revenues so there’s that we also know that Cisco has a very good quarter and also again another read through to broadcom because they have networking which is about 30 of their total revenue so I feel pretty good about the outfit guidance for broadcom I think the quarter might be very sloppy and a lot of that is because Enterprise is still under pressure cloud is still under pressure but at the end of the day they have 31 billion in backlog the stock has massively lagged this this SMH it’s up only five percent the SMH is up 16 year-to-date it trades up 14 times it is a three percent yield and they’re generating 16 billion dollars in free cash flow a year and so their increase they increase their dividend last quarter buying back stock so I just like this.”
AVGO stock is up 80% over the past six months.
Polen Focus Growth Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its third quarter 2025 investor letter:
“In early August we initiated positions in both NVIDIA and Broadcom Inc. (NASDAQ:AVGO), after having not owned either company over the past 2½ years following the initial wave of enthusiasm around Gen AI. While we have long admired both companies, their highly cyclical business models have made it extremely difficult to forecast future earnings growth with any degree of conviction. Given our approach of seeking durable and persistent earnings growth that compounds over long holding periods, our concern in holding either was that we would be forced to endure a punishing downcycle within our typical holding period – there is very little room that in a concentrated portfolio of 20-30 companies. In fact, pre ChatGPT, NVIDIA had two punishing down cycles over the preceding five years.
That is specifically what has occurred for NVIDIA and Broadcom. While the sheer magnitude of demand for AI chips, servers and networking equipment was something that we clearly underappreciated, new incremental data points over the past few months lead us to conclude the current boom in AI chips and related hardware will likely continue for the foreseeable future giving us greater conviction over the trajectory of future earnings for both NVIDIA and Broadcom.
Broadcom is the other major player in the AI chip market, the number one provider of custom chips, and currently receives the majority of the remaining 10c of every dollar being spent by enterprises. As Gen AI use cases mature, and as inference workloads become a bigger piece of the compute pie, we expect that custom chips (and Broadcom’s in particular) will account for a larger share of the total market. …” (Click here to read the full text)
While we acknowledge the risk and potential of AVGO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AVGO and that has 10,000% 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.
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