Broadcom’s stock made headlines after surpassing a market cap of $1 trillion on Friday and has experienced a remarkable 24% surge which is the largest in a single-day increase in its history. The momentum has continued into Monday with the shares climbing an additional 11% fueled by the optimistic price target from Wall Street analysts.
This latest surge followed Broadcom’s impressive earnings report released late Thursday which exceeds the expectations and offers a positive forecast for the upcoming quarter. The company is famous for its semiconductors and infrastructure software and is capitalizing on the explosive demand which is driven by the generative artificial intelligence boom which is reported by a staggering 220% increase in AI revenue which totals $12.2 billion for the year.
Analysts at Goldman Sachs who are advocating for purchasing Broadcom shares raised their 12-month price target from $190 to $240 which highlights the addition of significant new clients for custom silicon. They also praised the management performance of the company following the $61 billion acquisition of VMware completed last year.
In a report which has been dated December 15, the analysts expressed heightened confidence in Broadcom’s future revenue and earnings growth potential. Meanwhile, Barclays adjusted its price target for the stock from $200 to $205 and Truist has also increased its target from $245 to $260. As of Monday, shares of Broadcom have soared 126% this year and it closed at $250; in comparison, Nvidia is a player in the AI search thanks to its popular graphics processing units or GPUs. It has observed its stock rise over 165% this year and has achieved a market cap of $3.2 trillion, the Nasdaq index has also enjoyed an increase of 34%. Broadcom distinguishes its custom AI accelerators which are referred to as XPUs from the GPUs of Nvidia.
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