Broadcom Inc. (AVGO) has reaffirmed its “Buy” rating despite market concerns over valuation, driven by the company’s strong financials, AI prospects, and sales structure updates. The analyst expects VMware’s high-margin software business to underpin the growth of AVGO’s AI semiconductors, leading to robust cash flow and margin stability.
The company’s ambitious AI market projections for 2027 have also driven short-term growth, with estimates suggesting $45 billion in AI revenue by FY 2027. Broadcom’s valuation is considered reasonable given current market conditions, with potential for further upside through continued EPS outperformance and share buybacks.
The analyst remains confident in their “Buy” rating, citing Broadcom’s strong financials and sales structure updates as key drivers of growth. With the company targeting $250-255 per share by 2025, investors can look forward to potential long-term gains.
Source: https://seekingalpha.com/article/4746386-broadcom-3-reasons-to-stay-bullish