AI Boost Propels Broadcom (AVGO) Towards Buy Point: Today’s Top IBD Stock

  • Broadcom (AVGO) is gaining momentum in the stock market, driven by the growing trend of artificial intelligence. The company is also nearing a buy point.
  • The California-based company provides an alternative to Nvidia’s market-leading AI chips by offering custom application-specific integrated circuits, or ASICs.
  • Broadcom’s AI chips are used in data centers by tech giants like Google and Facebook. The company recently added a new customer to its AI chip business, speculated to be TikTok parent ByteDance.

Broadcom (AVGO) is making waves in the stock market, thanks to the artificial intelligence trend. The company’s AI chips are used by tech giants and it is also approaching a buy point. This article delves into the details.

Broadcom’s Position in the AI Chip Market

Broadcom, based in Palo Alto, California, is offering a unique alternative in the AI chip market. Unlike Nvidia’s (NVDA) market-leading AI chips, Broadcom provides custom application-specific integrated circuits, or ASICs. These chips are utilized in data centers by tech giants such as Alphabet’s (GOOGL) Google and Facebook parent Meta Platforms (META).

New Customer Acquisition and Market Predictions

In March, Broadcom announced the addition of a new customer to its AI chip business. The customer was not identified, but several Wall Street analysts speculate that it is ByteDance, the parent company of TikTok. Jefferies analyst Blayne Curtis recently assumed coverage of Broadcom stock with a buy rating and a price target of 1,550. Curtis noted that the uptrend in the semiconductor cycle is still in its early stages, driven by heavy spending on AI infrastructure by cloud-computing services. He predicts that AI could account for 25% of semiconductor industry revenue by 2027, up from 5% in 2022.

Upcoming Catalysts for Broadcom Stock

The next potential catalyst for Broadcom stock is the company’s fiscal second-quarter report, due on June 12. According to IBD MarketSurge charts, Broadcom stock has been consolidating for the past 10 weeks at a buy point of 1,438.17. However, aggressive investors could use its rise above a downward trendline near 1,350 as an early entry, based on IBD analysis. Currently, Broadcom stock features on two IBD stock lists: SwingTrader and Tech Leaders.

Conclusion

Broadcom’s position in the AI chip market is strengthening, with its custom ASICs being used by major tech companies and the addition of a new customer. With the semiconductor cycle still in its early stages and AI predicted to account for a significant portion of industry revenue in the coming years, Broadcom’s stock is one to watch.

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Gideon Wolf
Gideon Wolfhttps://en.coinotag.com/
GideonWolff is a 27-year-old technical analyst and journalist with extensive experience in the cryptocurrency industry. With a focus on technical analysis and news reporting, GideonWolff provides valuable insights on market trends and potential opportunities for both investors and those interested in the world of cryptocurrency.
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