Broadcom (AVGO) stock extended gains on Thursday after the semiconductor firm said its artificial intelligence (AI) sales more than doubled in Q1, adding AI revenue will surpass $100 billion by 2027. The post-earnings surge helped AVGO soar past its major moving averages (20-day, 50-day, 200-day), indicating bulls have firmly taken control across multiple timeframes.
Despite today’s rally, Broadcom stock remains down about 5% versus its year-to-date high.
Broadcom’s market-beating quarter and impressive guidance made Goldman Sachs’ senior analyst Jim Schneider maintain his “Buy” rating on the chip giant. According to Schneider, the earnings report confirms demand for AVGO’s custom AI accelerators (XPU) and networking remains in hyperdrive.
Broadcom has fully secured component capacity through 2028, which Schneider believes will drive AVGO stock up to $450 by year-end, indicating potential upside of an exciting 36% from here.
A 0.79% dividend yield makes the Nasdaq-listed firm even more attractive as a long-term holding.
Goldman Sachs also recommends buying Broadcom shares because VMware integration has set up a stable cash-flow engine that enables the titan to aggressively reinvest in its AI roadmap.
On Thursday, the company authorized an additional $10 billion share repurchase program for 2026, signaling immense confidence in AVGO’s ability to push higher as the year unfolds.
While the technical breakout suggests this AI stock is now in a broader uptrend, its 14-day relative strength index (RSI) at about 50 signals the upward momentum is not out of juice just yet.
Finally, Broadcom is reaping benefits of a global infrastructure refresh as enterprise data centers transition to PCIe Gen6 and Tomahawk 5 networking standards.
This cyclical recovery in non-AI high-performance computing (HPC), combined with a dominant footprint in the custom ASIC market for hyperscalers, like Alphabet’s (GOOG) (GOOGL) Google and Meta (META), provides a diversified margin cushion that few can match.
Other Wall Street firms agree with Goldman Sachs’ constructive view on Broadcom as well.
