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Broadcom has a pathway to “join the trillionaires club,” Bank of America said as it reiterated a buy rating on the chipmaker Thursday. The firm raised its price target to $2,000 per share from $1,680, a forecast that implies nearly 34% upside from Wednesday’s $1,495.51 close. Broadcom’s current market cap is roughly $693 billion. If it were to breach the $1 trillion mark, it would join the ranks of Microsoft, Apple, Nvidia, Alphabet, Amazon and Meta Platforms. Analyst Vivek Arya said Broadcom’s steady semiconductor sales and its exposure to multiple secular product cycles could help it get there. AVGO YTD mountain Broadcom stock. The call follows strong second-quarter results that surpassed Wall Street estimates. Broadcom also announced a 10-for-1 stock split, which will take effect on July 15. On Thursday, Broadcom stock rallied more than 15% and touched a fresh 52-week high. Shares have gained about 34% year to date. Arya’s new price target envisions that the stock will trade at the upper end of its historical range — and at a premium to some of its peers — which he said is “justified given double-digit EPS growth and best-in-semis profitability, [free cash flow] generation, and returns.” The analyst noted that demand for Broadcom’s chips isn’t solely limited to artificial intelligence, and it’s made efforts to pay down its debt. “We rate Broadcom Buy due to its high-quality diversified exposure to secular product cycles in the smartphone, cloud data center, telecom and enterprise storage markets,” Arya said. “Additionally, with 45%+ EBITDA/FCF margins, Broadcom is among the most profitable semiconductor companies, which is likely to continue to drive strong cash returns,” he said.
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