Barclays Analyst Projects 13% Upside for Broadcom Stock Driven by AI Networking Demand
Wednesday, 20 March 2024, 16:01
Overview
The networking infrastructure provider Broadcom (NASDAQ: AVGO) is poised for growth, backed by the increasing demand for AI solutions. Barclays reinstates coverage on Broadcom with a $1,405 price target, anticipating a 13.5% upside.
Why buy Broadcom stock
Nvidia dominates the chip hardware market, but Broadcom's networking division saw a 46% revenue growth last quarter. Analysts favor Broadcom's high-margin software business, which posted a remarkable 153% revenue growth driven by acquisitions.
Should you invest?
- Broadcom's strong free cash flow and dividend policy augur well for shareholders.
- The stock's valuation is relatively higher now due to robust AI demand, while ongoing challenges in the broadband sector may temper gains.
- A focus on AI technology positions Broadcom for sustained long-term growth.
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