Broadcom Inc. (AVGO)
NASDAQ:AVGO
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Broadcom
(NASDAQ:AVGO)
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Rating:79Outperform
Price Target:
$426.00
▲(4.79% Upside)
Action:Reiterated
Date:06/11/26
The score is driven primarily by outstanding financial performance (elite margins and very strong free cash flow) and an exceptionally bullish earnings outlook tied to massive AI growth and backlog visibility. Offsetting factors are weak near-term technical momentum and a demanding valuation (high P/E with a low dividend yield), with execution/working-capital risks (inventory build, mix-driven margin pressure) as secondary constraints.
Positive Factors
Cash generation and margins
Sustained, very large free cash flow and elite margins provide durable financial flexibility: supports capex for AI capacity, ongoing buybacks/dividends, and meaningful debt reduction capacity. High cash conversion also cushions cyclical semiconductor swings and funds strategic M&A.
Negative Factors
Large absolute debt load
While leverage ratios are manageable relative to cash flow, the very large absolute debt creates structural interest and refinancing risk over multi‑year horizons. High nominal liabilities reduce optionality for opportunistic investments and raise sensitivity to any sustained cash‑flow disruption.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation and margins
Sustained, very large free cash flow and elite margins provide durable financial flexibility: supports capex for AI capacity, ongoing buybacks/dividends, and meaningful debt reduction capacity. High cash conversion also cushions cyclical semiconductor swings and funds strategic M&A.
Read all positive factors
Broadcom Key Performance Indicators (KPIs)
Any
Revenue by Segment
Analyzes revenue across different business units, highlighting which segments drive growth and profitability, and indicating strategic focus areas.
Analyzes revenue across different business units, highlighting which segments drive growth and profitability, and indicating strategic focus areas.
Data provided by:
The Fly
The FlyBroadcom (AVGO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.82T
Dividend Yield0.69%
Average Volume (3M)27.19M
Price to Earnings (P/E)61.9
Beta (1Y)2.46
Revenue Growth32.29%
EPS Growth125.17%
CountryUS
Employees37,000
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)6.19
Shares Outstanding4,757,580,000
10 Day Avg. Volume42,433,619
30 Day Avg. Volume27,186,159
Financial Highlights & Ratios
PEG Ratio0.26
Price to Book (P/B)21.01
Price to Sales (P/S)26.74
P/FCF Ratio63.47
Enterprise Value/Market Cap1.19
Enterprise Value/Revenue28.72
Enterprise Value/Gross Profit42.89
Enterprise Value/Ebitda51.57
Forecast
1Y Price Target
$513.43Price Target Upside26.29% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering27
EPS Forecast (FY)11.57
Revenue Forecast (FY)$105.07B
Broadcom Business Overview & Revenue Model
Company Description
Broadcom Inc. is a prominent global technology enterprise focused on the innovation, development, and supply of advanced semiconductor solutions and critical infrastructure software. The company's headquarters are situated in San Jose, California,...
How the Company Makes Money
Broadcom makes money primarily through two operating segments: (1) Semiconductor Solutions and (2) Infrastructure Software. In Semiconductor Solutions, it generates revenue mainly by selling chips and related components to equipment manufacturers ...
Broadcom Earnings Call Summary
Earnings Call Date:Jun 03, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Sep 03, 2026
Earnings Call Sentiment Positive
The call communicated exceptionally strong operational and financial performance driven by record revenue, margins, free cash flow, and massive AI semiconductor growth and bookings. Strategic multi‑year customer commitments, multi‑gigawatt deployment plans, and technology leadership underpin a highly positive outlook. The primary near‑term headwinds are mix‑driven gross margin compression, elevated inventory and working capital as the company secures supply, and concentration of growth in AI (with non‑AI semiconductors growing modestly). Overall, the positives substantially outweigh the risks.Positive Updates
Record Consolidated Revenue and Strong YoY Growth
Consolidated revenue was a record $22.2 billion in Q2, up 48% year‑over‑year; Q3 consolidated revenue guidance of $29.4 billion implies +84% year‑over‑year growth.
Negative Updates
Gross Margin Compression from Mix
Consolidated gross margin declined to 77.1% in Q2 (down ~32 basis points YoY) and is guided down further to ~74% in Q3 due to rapid AI semiconductor mix growth versus higher‑margin software; management attributes this to mix rather than structural semiconductor margin deterioration.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Consolidated Revenue and Strong YoY Growth
Consolidated revenue was a record $22.2 billion in Q2, up 48% year‑over‑year; Q3 consolidated revenue guidance of $29.4 billion implies +84% year‑over‑year growth.
Read all positive updates
Company Guidance
Broadcom guided Q3 fiscal 2026 consolidated revenue of $29.4 billion (up 84% YoY), with semiconductor revenue of approximately $20.5 billion (up 124% YoY) that includes AI semiconductor revenue of $16 billion (up >200% YoY) and non‑AI semiconductor revenue of about $4.5 billion (up ~12% YoY), infrastructure software revenue of roughly $8.9 billion (up 31% YoY), a consolidated gross margin near 74%, operating margin around 67%, adjusted EBITDA about 68% of revenue, a non‑GAAP tax rate of ~16% (Q3 and FY26), and an estimated non‑GAAP diluted share count of ~4.94 billion; management also reiterated FY26 AI semiconductor revenue of $56 billion (≈+180% YoY) and reiterated AI semiconductor revenue in excess of $100 billion for FY27.Broadcom Financial Statement Overview
Summary
Income Statement
92
Very Positive
Balance Sheet
78
Positive
Cash Flow
94
Very Positive
| Breakdown | TTM | Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 75.47B | 63.89B | 51.57B | 35.82B | 33.20B | 27.45B |
| Gross Profit | 50.53B | 43.29B | 32.51B | 24.69B | 22.09B | 16.84B |
| EBITDA | 42.02B | 34.71B | 23.88B | 20.55B | 19.16B | 14.69B |
| Net Income | 29.32B | 23.13B | 5.89B | 14.08B | 11.49B | 6.74B |
Balance Sheet | ||||||
| Total Assets | 179.16B | 171.09B | 165.65B | 72.86B | 73.25B | 75.57B |
| Cash, Cash Equivalents and Short-Term Investments | 19.63B | 16.18B | 9.35B | 14.19B | 12.42B | 12.16B |
| Total Debt | 64.91B | 65.14B | 67.57B | 39.65B | 39.98B | 40.27B |
| Total Liabilities | 91.47B | 89.80B | 97.97B | 48.87B | 50.54B | 50.58B |
| Stockholders Equity | 87.69B | 81.29B | 67.68B | 23.99B | 22.71B | 24.99B |
Cash Flow | ||||||
| Free Cash Flow | 32.76B | 26.91B | 19.41B | 17.63B | 16.31B | 13.32B |
| Operating Cash Flow | 33.62B | 27.54B | 19.96B | 18.09B | 16.74B | 13.76B |
| Investing Cash Flow | -596.00M | -580.00M | -23.07B | -689.00M | -667.00M | -245.00M |
| Financing Cash Flow | -22.87B | -20.13B | -1.73B | -15.62B | -15.82B | -8.97B |
Broadcom Technical Analysis
Neutral
406.54
Price Trends
406.45
Negative
365.49
Positive
357.27
Positive
Market Momentum
-5.89
Positive
41.40
Neutral
7.69
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AVGO, the sentiment is Neutral. The current price of 406.54 is below the 20-day moving average (MA) of 418.73, above the 50-day MA of 406.45, and above the 200-day MA of 357.27, indicating a neutral trend. The MACD of -5.89 indicates Positive momentum. The RSI at 41.40 is Neutral, neither overbought nor oversold. The STOCH value of 7.69 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AVGO.
Broadcom Risk Analysis
Broadcom disclosed 42 risk factors in its most recent earnings report. Broadcom reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Broadcom Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $223.15B | 22.74 | 40.19% | 2.01% | 5.21% | -6.72% | |
79 Outperform | $1.82T | 61.86 | 32.85% | 0.69% | 32.29% | 125.17% | |
79 Outperform | $1.11T | 45.79 | 40.84% | 0.20% | 85.55% | 410.18% | |
78 Outperform | $834.17B | 166.57 | 8.08% | ― | 34.97% | 123.87% | |
78 Outperform | $244.68B | 97.64 | 16.84% | 0.28% | 34.07% | ― | |
63 Neutral | $626.09B | -199.49 | -2.95% | ― | 1.36% | 86.07% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
AVGO
Broadcom
382.07
132.00
52.78%
AMD
Advanced Micro Devices
511.57
385.18
304.76%
INTC
Intel
124.57
103.83
500.63%
MRVL
Marvell
279.70
209.47
298.26%
MU
Micron
981.61
862.06
721.07%
QCOM
Qualcomm
211.72
58.09
37.81%
Broadcom Corporate Events
Business Operations and Strategy
Broadcom Launches $2.5 Billion Senior Notes Tender Offer
Positive
Jun 11, 2026
On June 11, 2026, Broadcom launched cash tender offers to repurchase up to $2.5 billion of several series of its outstanding senior notes maturing between 2030 and 2038, subject to a consideration cap and specified acceptance priorities. The offer...
Business Operations and StrategyDividendsFinancial Disclosures
Broadcom Posts Record Q2 Results on Surging AI Demand
Positive
Jun 3, 2026
On June 3, 2026, Broadcom reported second-quarter fiscal 2026 results for the period ended May 3, 2026, with revenue jumping 48% year-on-year to a record $22.2 billion and GAAP net income rising 88% to $9.3 billion, driven largely by surging deman...
Executive/Board ChangesShareholder Meetings
Broadcom Shareholders Back Board, Auditor and Executive Pay
Positive
Apr 21, 2026
Broadcom Inc. held its 2026 Annual Meeting of Stockholders on April 20, 2026, where shareholders elected eight directors, including CEO Hock E. Tan and co-founder Henry Samueli, to serve until the next annual meeting or until successors are chosen...
Business Operations and Strategy
Broadcom Expands Long-Term AI Infrastructure Partnership With Google
Positive
Apr 6, 2026
Broadcom has signed a long-term agreement with Google to develop and supply custom Tensor Processing Units for Google’s future TPU generations, alongside a supply assurance deal to provide networking and other components for Google’s n...
Executive/Board Changes
Broadcom Names New CFO as Longtime Finance Chief Retires
Neutral
Apr 2, 2026
On March 30, 2026, Broadcom announced that longtime finance chief Kirsten M. Spears will retire and resign as chief financial officer and chief accounting officer, effective June 12, 2026, and will remain as a consultant through March 15, 2027 und...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.