Broadcom: AI-Driven Semiconductor Upside Outweighs Software Headwinds, Supporting Buy Rating

Analyst Timothy Arcuri of UBS reiterated a Buy rating on Broadcom, retaining the price target of $475.00.

Timothy Arcuri has given his Buy rating due to a combination of factors tied to Broadcom’s valuation and growth profile. He argues that, even when the software and semiconductor segments are valued separately, the core chip business does not appear overpriced relative to peers like NVDA, despite trading at somewhat higher earnings and cash flow multiples.

At the same time, he acknowledges emerging risks in the software unit—such as possible VMware customer losses, slower uplift from prior pricing and bundling changes, and pressure from AI development tools—but still expects mid‑single‑digit annual growth through 2029. Layered on top of this, he sees Broadcom’s AI semiconductor revenue ramping sharply over the next few years, which, in his view, more than offsets software headwinds and supports a constructive stance on the stock overall.

In another report released today, TD Cowen also maintained a Buy rating on the stock with a $405.00 price target.