2024-06-21 11:58:38 ET
Summary
- Broadcom Inc. stock has grown by over 28% since March 2024, outperforming the S&P 500 by six times. I believe it's just the beginning.
- Recent financial reports show strong revenue growth, particularly in AI-related revenues and infrastructure software.
- We already see that the integration of VMware has simplified operations and significantly reduced costs.
- I expect AVGO's margins to improve as the product mix balances out and the high-margin AI and networking solutions continue to grow.
- My calculations indicate an upside potential of 36.7% for the next 12-16 months as the company keeps exceeding estimates and holding its P/E at or above 30x.
My Thesis
I first initiated coverage of Broadcom Inc. ( AVGO ) on March 22, 2024, stating that the company's strong financials, sales structure updates, and AI prospects pointed to further outperformance in the future. Since then, the stock has grown by over 28%, outperforming the S&P 500 by approximately six times, becoming one of my best calls on Seeking Alpha so far for such a short period of time....
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For further details see:
Broadcom Stock: It's Just The Beginning