Evercore ISI Raises Broadcom Price Target to $304

Evercore ISI analyst Mark Lipacis raised the price target on Broadcom Limited (NASDAQ: AVGO) to $304 (from $267) while maintaining an Outperform rating.

“We’re Still Buyers… of AVGO after an in-line AprQ print and implied EPS outlook that is $0.01 below consensus.

AI revs of $4.4bn were inline, but the good news is that its $5.1bn JulQ outlook for AI revs is above our original $4.9bn, and more importantly, the company expects its current AI revenue momentum to extend into FY26, so we now model 58% growth in AI for FY25 and 50% in FY26, split roughly 70/30 XPU/AI Networking.

AVGO’s AI visibility is consistent with our own AI channel checks that indicate 1) no slowdown in AI spend by hyperscalers, and 2) increased demand for larger and more accurate LLMs.

Near-term, we expect some weakness in the stock due in part to the difficult set-up heading into the print (68% 2-month move vs SPX 19%), and at a P/E of 35x, AVGO is the most expensive amongst largecap peers.

That said, AVGO is the premier supplier of custom-AI XPUs, with high and improving visibility and a 40%-50% FCF margin, and we expect it to maintain a premium P/E.

We are particular buyers of the post-earnings weakness. We increase our estimates, and our price target to $304 from $26.”

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