Bernstein SocGen Reiterates Outperform on Broadcom, $525 Price Target
Bernstein SocGen Group analyst Stacy Rasgon reiterated an Outperform rating and $525.00 price target on Broadcom Limited (NASDAQ: AVGO).
“The Broadcom custom ASIC announcements continue apace, as the company on Tuesday afternoon announced a multi-year, multi-generation extended partnership with Meta to support “multi-gigawatts of Meta’s custom silicon, MTIA.” The initial commitment exceeds 1 GW (with more to come) with plans to extend through at least 2029, and includes multiple generations of MTIA chips for training and inference, as well as networking components while extending beyond simply hardware supply to focus on system-level optimization and R&D as well.
Given the scale of the partnership expansion, Hock will transition off of Meta’s board into an advisor role where he will “provide guidance on Meta’s custom silicon roadmap and help shape the future of their infrastructure investments.” We believe the depth and scale of the partnership is such that it is becoming challenging to manage potential conflicts; as such we are not concerned by the move (it’s likely a positive read frankly).
The announcement does not seem hugely incremental to medium-term AVGO numbers vs what the company shared in March, though the 2029 timeframe does appear new.”
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