RBC Capital Initiates Broadcom at Sector Perform, $370 Price Target
RBC Capital analyst Srini Pajjuri initiates coverage on Broadcom Limited (NASDAQ: AVGO) with a Sector Perform rating and a price target of $370.00.
“The key debates on AVGO are 1) GM impact from AI growth, 2) sustainability of Anthropic ramps, 3) magnitude/timing of OpenAI opportunity.
We see upside potential to 2026 AI estimates from strong demand at Google/Meta. Anthropic’s TPU rack purchases are a significant driver in 2H26.
However, racks come with lower margins and sustainability of Anthropic’s demand beyond 1H27 is less clear.
We are also taking a conservative view on OpenAI contribution in 2027 given its multiple commitments. Valuation is at ~25% premium to NVDA, which we think makes risk/reward less compelling.
Initiate at Sector Perform.”
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