Broadcom: AI-Driven Growth Outlook Outweighs Margin and Competition Risks, Supporting Buy Rating

Analyst Atif Malik of Citi maintained a Buy rating on Broadcom, reducing the price target to $458.00.

Atif Malik has given his Buy rating due to a combination of factors tied to Broadcom’s AI positioning and earnings outlook. He expects AI-related revenues, particularly from Google’s TPU programs and other hyperscale customers, to scale materially through FY27, driving solid top-line growth and modest upside to earnings despite some pressure on gross margins.

At the same time, he views the recent compression in AVGO’s valuation multiple as overly discounting risks from TPU competition, margin dilution, and slower infrastructure software growth. As visibility into AI demand extends out to 2027 and competitive fears subside, he anticipates the shares will outperform, supporting a Buy rating even after trimming his target price based on updated margin and EPS assumptions.

In another report released on February 10, Bernstein also maintained a Buy rating on the stock with a $475.00 price target.

Based on the recent corporate insider activity of 64 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of AVGO in relation to earlier this year.