Broadcom's Stock Has Been Slipping. These Analysts Say It's Time To Buy
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Bloomberg / Contributor / Getty Images Microchips manufactured by Broadcom.
Key TakeawaysBroadcom shares tumbled Friday after the company’s outlook disappointed investors, but Bank of America and Jefferies analysts said Broadcom's fall could present an opportunity to buy.Bank of America called Broadcom a “top compute pick,” citing the chipmaker's potential for growth driven by surging artificial intelligence demand.Bank of America, Jefferies, and every other analyst covering Broadcom tracked by Visible Alpha on Friday held a "buy" or equivalent rating for the stock.
Broadcom (AVGO) shares tumbled Friday after the company’s outlook disappointed investors, but analysts were broadly bullish on the stock, suggesting that its recent losses could present an opportunity to buy the dip.“One bump doesn't make a trend,” Jefferies analysts wrote in a note published following the results. “Guidance came in a bit lighter than expected, but management has been messaging lumpiness in AI revenue and growth is set to reaccelerate" in the fourth quarter.“We believe the story is well-positioned into next year, and would buy any weakness," they wrote.Broadcom stock fell about 10% on Friday, leaving it up more than 20% for the year. The latest move, after the company reported results late yesterday, in some ways resembled investors' reaction to Nvidia's (NVDA) latest quarterly numbers, which may have disappointed those looking for even more upbeat signals.'A High-Quality Tale of Transformation'Bank of America analysts called Broadcom a “top compute pick,” citing the chipmaker's potential for growth driven by surging artificial intelligence demand.“We continue to see [Broadcom] as a high-quality tale of transformation, from a mid-single digit growth to a mid-teens growth company driven by [a] shift to growthier AI and VMWare segments,” the analysts said. Bank of America, Jefferies, and every other analyst covering Broadcom tracked by Visible Alpha held a "buy" or equivalent rating for the stock, with a consensus price target of $193.42 suggesting about 40% upside from Friday's close.UPDATE: This story has been updated to reflect fresh share-price information. Read the original article on Investopedia.
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