Piper Sandler Initiates Broadcom at Overweight, $460 PT
Piper Sandler analyst David O’Connor initiates coverage on Broadcom Limited (NASDAQ: AVGO) with a Overweight rating and a price target of $460.
“AVGO is the leader in ASIC chips (75% share) for AI inference, with most hyperscalers and AI Labs having an ASIC co-design relationship with them.
While Google TPU is the volume shipper today, and also being leveraged by Anthropic, the company is in ramp-up mode for Meta MTIA, OpenAI Jalapeño chips as well as two other customers.
Coupled to this, AVGO’s Networking attach rate is running at 30%, enabling $20-30B total content per GW.
The company has line of sight for 12GW of demand in FY27E, we estimate 23-30GW in FY28-29 and 38GW in FY30.
However, demand is 2x supply, so securing additional supply is key going forward. We estimate an EPS CAGR of ~51% to 2030.
The stock is the cheapest in our AI universe, and we set our FY28E P/E based PT to $460 using 14x multiple. Initiating at OW.”
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