Analyst Fang Boon Foo of DBS maintained a Buy rating on Broadcom (AVGO – Research Report), retaining the price target of $250.00.
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Fang Boon Foo has given his Buy rating due to a combination of factors including Broadcom’s strategic growth through acquisitions and its strong financial performance. The recent acquisition of VMware has significantly bolstered Broadcom’s position in the infrastructure software market, complementing its existing semiconductor operations. The company is poised to benefit from the AI boom, as it is a key player in the custom AI-chip market, with expectations of substantial revenue growth in this area.
Broadcom’s impressive 10-year compound annual growth rate in revenue and EBITDA, alongside its strategic shift towards software with higher margins, underscores its solid financial trajectory. The company is also recognized for generating consistent free cash flows and paying stable dividends, which differentiates it from its peers. The anticipation of strong business momentum in the coming fiscal year, driven by AI-chip demand and the VMware acquisition, further supports Fang Boon Foo’s positive outlook on Broadcom’s stock.
Boon Foo covers the Technology sector, focusing on stocks such as Qualcomm, Nvidia, and Broadcom. According to TipRanks, Boon Foo has an average return of 45.8% and a 76.47% success rate on recommended stocks.
In another report released on February 12, Mizuho Securities also reiterated a Buy rating on the stock with a $0.00 price target.