Broadcom: Market Sweating The AI Details
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Stone Fox CapitalInvesting Group LeaderFollow5ShareSavePlay(10min)CommentsSummaryBroadcom reported AI-driven revenue surged 74% YoY, with FQ1'26 guidance for AI revenue to double to $8.2 billion, yet margin pressure persists.The semiconductor company got hit with overblown market concerns over lower margins, AI backlog, and OpenAI commitments.Gross margin concerns stem from product mix, not competitive pressure, as massive AI demand drives overall profit and cash flow growth.The stock valuation now approaches Nvidia, with AVGO trading at 28x FY27 EPS; support levels at $325 and $300 are key for portfolio decisions. Vertigo3d/iStock via Getty Images As highlighted in prior research, Broadcom Inc. (AVGO) was already trading at an elevated level for the impact the AI sales growth had on the overall business. The tech giant just reported another strong quarter, but the market was inThis article was written byStone Fox Capital54.26K FollowersFollowStone Fox Capital is an RIA from Oklahoma. Mark Holder is a CPA with degrees in Accounting and Finance. He is also Series 65 licensed and has 30 years of investing experience, including 15 years as a portfolio manager. Mark leads the investing group Out Fox The Street where he shares stock picks and deep research to help readers uncover potential multibaggers while managing portfolio risk via diversification. Features include various model portfolios, stock picks with identifiable catalysts, daily updates, real-time alerts, and access to community chat and direct chat with Mark for questions. Learn more.Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock, you should do your own research and reach your own conclusion or consult a financial advisor. Investing includes risks, including loss of principal.Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.Recommended For You