Ghazal Ahmed
2 min read
In This Article:
Broadcom Inc. (NASDAQ:AVGO) is one of the 10 AI Stocks Making Waves on Wall Street. On June 30, Jefferies reiterated the stock as “Buy” and raised its price target to $315 per share from $300. The rating affirmation reflects the firm’s optimism in the AI and networking sectors. It believes that Broadcom boasts a strong hold in the AI application-specific integrated circuit (ASIC) market, focusing on prominent developers of large language models.
“The AI ASIC message has stayed consistent: they are targeting major customers building their own LLMsDespite recent concerns, AVGO was clear that they are still deeply engaged with the same customer base and don’t see any future share loss. In the long run, AVGO sees seven major LLM players worldwide (five in US) as the target customer base for ASICs.” -Jefferies analysts, led by Blayne Curtis, in a Monday investor note.
A close up of a circuit board, its microchips creating a powerful computing system.
The firm also sees potential in Broadcom’s networking solutions.
“The battle has heated up for the scale-up opportunity with Nvidia’s (NVDA) NVLink still the leader, but both AVGO and Astera Labs (ALAB)/UALink working on competing solutions,” Curtis noted. “The opportunity is expected to be 5-10x larger than scale-out and AVGO expects to have solutions using both Tomahawk and Jericho.”
The company is also set to ramp up Google’s Ironwood TPU during the second half of 2025.
“On the supply chain side, AVGO plans to keep HBM in-house to prevent anything that could go wrong and ensure responsibility for the final product,” Curtis said. “HBM4 is on the roadmap but no vendor decisions have been made.”
Broadcom is a technology company uniquely positioned in the AI revolution owing to its custom chip offerings and networking assets.
While we acknowledge the potential of AVGO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 10 AI Stocks in the Spotlight and 10 AI Stocks Investors are Watching. Disclosure: None.
