🎁AVGO Q1 Beat & 106% AI Surge! The Next Nvidia?
$Goldman Sachs(GS)$ expects $Broadcom(AVGO)$'s stock to rise following strong quarterly results and guidance that beat market expectations, driven by outstanding AI semiconductor performance.
🎯 Consequently, the firm reiterates a "Buy" rating with an increased price target of $480.
📈 Crushing Estimates: Broadcom's Actuals VS Projections
$Broadcom(AVGO)$ delivered stellar Q1 results with $19.3 billion in total revenue, matching $Goldman Sachs(GS)$ and beating the Street's $19.2 billion.
Looking ahead, Q2 revenue guidance is set at a massive $22.0 billion, crushing the Street's $20.5 billion forecast.
Profitability also shined across the board. Q1 gross margin reached a strong 77.0%, while operating margin impressed at 66.4% to beat the Street's 65.5% estimate.
Core Business Growth Potential:
-
🔥 AI Semiconductors & Custom Silicon: AI chip revenue jumped 106% YoY to $8.4B. FY27 AI revenue is expected to top $100B, driven by custom silicon deals with Google, Meta, Anthropic, and OpenAI.
-
🌐 Networking Leadership: Networking will drive 40% of Q2 AI revenue. Ethernet demand remains extremely strong. Tomahawk 6 dominates the market, paving the way for a massive Tomahawk 7 ramp.
-
🛡️ Supply Chain & Margin Armor: Broadcom has secured all critical components through FY28. This visibility completely eases investor fears of shortages. Increased production scale and improving yields will protect profit margins.
🔥Goldman's Take: The $100B AI Surge & Traditional Tech Risks
$Broadcom(AVGO)$'s leadership in AI networking and custom silicon positions it to deliver cost reductions on pace with market leader $NVIDIA(NVDA)$.
-
Q2 Outlook: Broadcom guided Q2 revenue to $22.0 billion, crushing the Street's estimate. Adjusted EBITDA margin is expected to hit a strong 68%.
-
The Growth Drivers: This surge is fueled by incredible AI strength. Q2 AI semiconductor revenue alone is projected at $10.7 billion. Networking products will contribute 40% of this Q2 AI revenue. Long-term, expanding custom silicon partnerships with Google, Meta, Anthropic, and OpenAI will push FY27 AI revenue significantly beyond $100 billion.
⚠️ Key Risks to Watch
-
AI Spending: A potential slowdown in overall AI infrastructure spending.
-
Market Share: Losing ground in the custom compute franchise or facing increased competition in VMware.
-
Non-AI Drag: Persistent inventory digestion in traditional, non-AI segments.
🎯 $480 Target: Bulls vs. Bears
$Goldman Sachs(GS)$ has set a solid 12-month base price target of $480.00 for Broadcom, forecasting a massive 45.3% potential total return. They even mapped out a "Bull" scenario pushing the stock as high as $630.00!
💬 What do you think?
-
Do you agree with Goldman's bullish $480 target, or is it too optimistic?
-
With all this AI momentum, what is your personal target price for AVGO by the end of this week?
💰leave your comments to win at least 5 tiger coins💰
For SG users only, welcome to open a CBA today and enjoy access to a trading limit of up to SGD 20,000 with unlimited trading on SG, HK, and US stocks, as well as ETFs.
🎉Cash Boost Account Now Supports 35,000+ Stocks & ETFs – Greater Flexibility Now
-
Find out more here.
Complete your first Cash Boost Account trade with a trade amount of ≥ SGD1000* to get SGD 688 stock vouchers*! The trade can be executed using any payment type available under the Cash Boost Account: Cash, CPF, SRS, or CDP.
-
other helpful links:
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
Do you agree with Goldman's bullish $480 target, or is it too optimistic?
With all this AI momentum, what is your personal target price for AVGO by the end of this week?
💰leave your comments to win at least 5 tiger coins💰
That is a massive set of numbers! Goldman's
$480 target represents a serious vote of confidence in Broadcom's "AI armor." With custom silicon revenue for Meta and Google scaling fast, the pivot from a traditional chipmaker to an AI powerhouse seems to be in full swing.
However, the "Non-AI Drag" mentioned is the real wildcard—investors usually hate seeing traditional segments lag while the "shiny" AI side carries the team.
As for a personal target price by the end of this week, much depends on whether the broader market FOMO continues or if traders decide to take profits after such a huge guidance beat.
Goldman Sachs raised its target to $480 following Broadcom's blockbuster Q1 2026 earnings report on March 4. Whether this is "too optimistic" depends on your timeframe:
The Bull Case: Broadcom’s AI revenue grew 106% year-over-year to $8.4 billion. Their custom silicon (XPU) business with Google and Meta is surging, and management expects 2026 AI revenue to grow over 100%.
The Risk Case: A $480 target implies massive upside from the current ~$333 level. To reach it, the market must be willing to sustain a very high P/E ratio, assuming the AI infrastructure build-out doesn't hit a "digestion phase" in late 2026.
Broadcom (AVGO) is currently riding a massive post-earnings "gap up." Here is the technical and sentimental outlook for the remainder of this week:
Current Price Action: The stock closed March 5 at $332.74, up over 5% in a single session.
Support/Resistance: Traders are watching the $340 level as immediate psychological resistance.
The "Post-Earnings Drift": Stocks with earnings beats of this magnitude often see follow-through buying for 2-3 days as institutional funds rebalance their positions.
Estimated Weekly Target: Given the $10 billion buyback news and multiple analyst upgrades (some as high as $500), a push toward $345 - $350 by the close of Friday is a common expectation among momentum traders.