Broadcom Inc
NASDAQ:AVGO
Intrinsic Value
The intrinsic value of one
AVGO
stock under the Base Case scenario is
235.39
USD.
Compared to the current market price of 321.43 USD,
Broadcom Inc
is
Overvalued by 27%.
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Let our AI break down the key assumptions behind the intrinsic value calculation for Broadcom Inc.
Fundamental Analysis
Customer Concentration Risk – A large portion of Broadcom’s revenue comes from a few key customers, including Apple and major cloud providers. Any loss of a major contract or shift toward in-house chip development by these clients could significantly impact revenue.
Regulatory and Geopolitical Uncertainty – The acquisition of VMware has faced intense regulatory scrutiny, and ongoing U.S.-China trade tensions pose a risk to Broadcom’s global supply chain and customer base. Restrictions on semiconductor exports could limit growth in key international markets.
Cyclical Semiconductor Demand – Despite software diversification, Broadcom remains heavily exposed to semiconductor cycles. A slowdown in cloud spending, weaker enterprise IT budgets, or excess chip supply could pressure margins and revenue growth in the near term.
Dominance in AI and Data Center Infrastructure – Broadcom is a key supplier of AI-optimized networking chips, custom silicon, and accelerators, making it an essential player in the AI revolution. As demand for AI workloads grows, Broadcom benefits from strong relationships with hyperscalers like Google, Amazon, and Microsoft.
High-Margin Software Expansion (VMware Acquisition) – The $69 billion acquisition of VMware significantly boosts Broadcom’s recurring revenue through enterprise software subscriptions. This shift towards software diversification enhances profitability and reduces cyclicality tied to semiconductor demand.
Strong Financials and Shareholder Returns – Broadcom generates robust free cash flow, allowing for consistent dividend growth and aggressive share buybacks. Its capital-efficient business model supports a ~2% dividend yield and steady EPS expansion.
Revenue & Expenses Breakdown
Broadcom Inc
Earnings Waterfall
Broadcom Inc
Wall St
Price Targets
AVGO Price Targets Summary
Broadcom Inc
According to Wall Street analysts, the average 1-year price target for
AVGO
is 465.73 USD
with a low forecast of 373.7 USD and a high forecast of 561.75 USD.
The intrinsic value of one
AVGO
stock under the Base Case scenario is
235.39
USD.
Compared to the current market price of 321.43 USD,
Broadcom Inc
is
Overvalued by 27%.
