At its Enabling AI Infrastructure event, semiconductor company Broadcom (NASDAQ:AVGO) announced it expanded its next-generation artificial intelligence (AI) infrastructure product offerings. This is a positive move as it will accelerate Broadcom’s growth rate further and strengthen its competitive positioning.
Notably, AVGO is benefitting from robust demand for its networking products in AI data centers and the adoption of its custom AI chips. AVGO said the latest AI infrastructure offerings will likely solidify its position as an industry leader in custom AI accelerators, Peripheral Component Interconnect (PCI) Express, Ethernet, and optical interconnect technologies.
The company, which develops and supplies semiconductor, enterprise software, and security solutions, also announced a significant milestone. It added a third customer for its custom AI chips, which is encouraging and will likely drive its financials in the coming years. The company said the third customer operates within the consumer AI domain, and AVGO expects to ship products to this customer in the next few months.
Is Broadcom a Buy, Sell, or Hold?
Broadcom stock has more than doubled in one year thanks to the AI-led tailwinds. However, Wall Street analysts are bullish about its prospects.
TD Cowen analyst Matt Ramsay upgraded AVGO stock to Buy from Hold following the Enabling AI Infrastructure event. His price target of $1,500 implies 17.55% upside potential. The analyst sees further upside in AVGO stock despite this recent run. He highlights various factors, such as increased demand driven by AI and the addition of a third customer for its custom AI chips, as catalysts for future gains.
Broadcom stock has 18 Buy and three Hold recommendations for a Strong Buy consensus rating. Analysts’ average price target on AVGO stock is $1,569, implying a 22.96% upside potential from current levels.
