AVGO stock forecast: Google Denies Ending Ties with Broadcom

Alphabet-owned Google has swiftly dismissed rumors surrounding its purported separation from chip maker Broadcom (AVGO:NSD). The tech giant’s spokesperson reaffirmed the pivotal role Broadcom plays in meeting both internal and external cloud requirements, putting to rest any doubts about the ongoing partnership. In this article, we will explore the intricacies of this collaboration and provide an outlook on the AVGO stock forecast, highlighting its current performance and future potential.

Background:

Recent reports had suggested that Google was considering ending its business ties with Broadcom. Such news can have significant ramifications in the stock market, as partnerships with major tech giants like Google often contribute significantly to a company’s revenue and growth prospects.

Google-Broadcom Partnership Stays Strong:

Contrary to media speculation, Google remains firmly committed to its partnership with Broadcom. Moreover, this relationship extends beyond conventional boundaries as Broadcom supplies tensor processing unit (TPU) chips to Google, indispensable for the company’s artificial intelligence (AI) endeavors. In turn, Google relies on Broadcom for chip supplies essential for its phones, data centers, and cloud services. Notably, Broadcom stands as one of Google Cloud’s largest clients, availing itself of the tech giant’s cloud services.

AVGO Stock Forecast and Bullish Perspective:

Renowned analyst Colin Sebastian from Robert W. Baird has expressed confidence in Broadcom’s prospects. Sebastian regards AVGO stock as his “Top Idea” and anticipates a lasting partnership with Google.

• Analysts at Robert W. Baird & Co. maintain an “Outperform” rating and raise the target price from USD 900 to USD 1000.
• Rosenblatt Securities analysts have reiterated a “Buy” rating with a target price of USD 1000.
• Analysts at Truist Financial maintain a “Buy” rating, raising the target price from USD 942 to USD 995.

Industry insights hint at substantial growth in Broadcom’s TPU-related volumes, forecasted to surge from 700,000 units in 2023 to an impressive 3 million in 2024. Furthermore, Sebastian envisions Broadcom’s ability to retain long-term customers. While this paints a rosy picture for AVGO, let’s consider the consensus rating on Wall Street.

Broadcom’s End-to-End AI Platform:

Broadcom’s innovation extends to its creation of an end-to-end platform facilitating customers in developing and deploying AI clusters. This innovation is expected to bolster its financial performance, thanks to the burgeoning demand for generative AI deployments.

AVGO Stock Forecast:

Broadcom has displayed remarkable results, surging by over 47% year-to-date. Analysts have pegged an average price target of $911.24, implying a promising 12.73% upside potential from current levels but based on the AVGO stock forecast from 17 analysts, the target price is USD 911.24 over the next 12 months. Stock Target Advisor’s analysis leans towards a Slightly Bullish stance, supported by 11 positive signals against 5 negative signals.

Stock Performance:

As of the last closing, the stock price stood at USD 808.36. Over the past week, it exhibited a slight dip of -7.26%, while the one-month performance witnessed a decrease of -6.56%. Remarkably, the stock has witnessed a substantial growth of +67.66% over the past year.

Conclusion:

Despite rumors of a potential breakup, Google’s confirmation of its ongoing collaboration with Broadcom underscores the significance of this partnership in the tech world. Analysts remain bullish on AVGO stock, predicting significant growth in the coming years, driven by the ever-expanding AI landscape. 

Maryam Nasir