Latest news with #Broadcom
Yahoo
24 minutes ago
- Business
- Yahoo
Broadcom (AVGO) Stock: Oppenheimer Boosts Price Target on AI Tailwinds
Broadcom Inc. (NASDAQ:) is one of the . On July 15, Oppenheimer reiterated Broadcom as 'Outperform' and raised the firm's price target to $305 from $265. The firm affirmed the rating after increasing targets in the semiconductor group as part of a Q2 preview. According to Oppenheimer, most companies that are exposed to artificial intelligence are in for a 'beat and raise' setup. The firm is long-term bullish on the entire sector based on the powerful role of semis in AI and the broader technology value chain. 'Our top picks are NVDA , AVGO, MRVL, and MPWR.' Particularly for Broadcom, Oppenheimer noted three factors supporting the bullish thesis: the company's expanding earnings power over time, sticky and stable industrial and infrastructure exposure, and defensible technology. Broadcom deserves to trade at a multiple closer to in line with its peer group, the firm believes. Broadcom is a technology company uniquely positioned in the AI revolution owing to its custom chip offerings and networking assets. While we acknowledge the potential of AVGO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: and Disclosure: None. Sign in to access your portfolio
Yahoo
5 hours ago
- Business
- Yahoo
This Artificial Intelligence (AI) Stock Trades at Just 22 Times Earnings -- and It's Growing Fast
Key Points Micron's earnings are expected to multiply substantially, and yet the stock can be bought at an incredibly attractive valuation right now. The growth opportunity in the memory chip market, driven by AI applications, should enable this chipmaker to deliver outstanding growth. 10 stocks we like better than Micron Technology › Artificial intelligence (AI) has supercharged the growth of many companies in the past two to three years, thanks to the huge amounts of money that are being spent on both AI hardware and software to train AI models and move them into production to unlock the benefits of this technology. Not surprisingly, many of the top AI names are now trading at expensive valuations. From chip giants such as Nvidia and Broadcom to software specialists such as Palantir Technologies and SoundHound AI, investors will have to pay huge premiums if they are looking to add a top AI stock to their portfolios right now. However, there's one company that's not just trading at an extremely attractive valuation, but is growing at an incredible pace as well thanks to AI: Micron Technology (NASDAQ: MU). Let's see why investors would do well to buy this stock now. Data centers, smartphones, and computers are fueling this chipmaker's terrific growth Micron Technology manufactures and sells memory and storage chips that are deployed in AI graphics cards, personal computers (PCs), and smartphones. This makes the company one of the best bets on the secular growth of the AI hardware market. After all, AI chips used in data centers are equipped with large amounts of high-bandwidth memory (HBM), since they can provide substantially higher bandwidth and lower latency. These properties allow HBM chips to quickly transport a lot of data in comparison to legacy memory chips, making them ideal for tackling AI workloads. Micron management points out that the company has "deep relationships with practically every major customer of HBM." Third-party reports suggest the same, indicating that Micron sells its HBM to the top four AI chipmakers that produce both GPUs and custom AI processors. The company is reportedly looking to corner a fourth of the HBM market by the end of the year, and that could translate into a nice increase in Micron's revenue and earnings. After all, the HBM market's revenue is expected to almost double in 2025, generating $35 billion in sales, per Micron's estimates. What's more, the HBM market's revenue is expected to hit $100 billion by 2030. Assuming Micron can sustain a 25% share of this space, HBM alone could contribute around $25 billion to its top line after five years (based on the $100 billion revenue estimate mentioned earlier). That would give Micron's growth a big boost, considering that the company has generated just under $34 billion in revenue in the trailing 12 months. Meanwhile, additional growth is likely to come from the PC and smartphone markets, where the demand for memory is increasing on account of a bump in the average dynamic random-access memory (DRAM) content, thanks to AI. For instance, the mobile DRAM market's revenue could jump sixfold over the next decade, generating more than $636 billion in revenue, as AI and machine learning (ML) applications will lead to an increase in the amount of compute memory required in smartphones. Importantly, this isn't where Micron's list of catalysts ends. The company says that it occupied the second spot in the data center solid-state drive (SSD) market in the first quarter. Again, this could turn out to be a huge positive for Micron in the future, as the data center SSD market's size is expected to grow by over 7x through 2033 from last year's levels. In all, it is easy to see that Micron has solid secular growth opportunities that could help it remain a top growth stock in the long run, and that's why buying the stock right now is a great idea, considering its valuation. The biggest reason to buy Micron stock hand over fist Consensus estimates are expecting a 6x jump in Micron's earnings in the current fiscal year, which will end next month. This astronomical growth can be attributed to skyrocketing memory prices caused by tremendous end-market demand -- fueled by AI -- in the multiple areas discussed. What's more, Micron is expected to clock a 54% jump in earnings in the next fiscal year as well. The good part is that investors can buy Micron stock at just 22 times earnings. That's a steal, considering that the U.S. technology sector has an average earnings multiple of 51. Another thing worth noting here is that Micron is undervalued when we take into account its long-term earnings growth potential. The stock has a price/earnings-to-growth ratio (PEG ratio) of just 0.15, based on its five-year projected earnings growth, per Yahoo! Finance. The PEG ratio is a forward-looking valuation metric that's calculated by dividing a stock's earnings multiple by its estimated annual earnings growth rate over the next five years. A reading of less than 1 means that a stock is undervalued when its future growth is considered. Micron's PEG ratio suggests that it is significantly undervalued. So, this AI stock is a no-brainer buy right now, as the remarkable growth that it has been clocking of late seems here to stay for a long time. Should you invest $1,000 in Micron Technology right now? Before you buy stock in Micron Technology, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Micron Technology wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $674,281!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,050,415!* Now, it's worth noting Stock Advisor's total average return is 1,059% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 15, 2025 Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia and Palantir Technologies. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy. This Artificial Intelligence (AI) Stock Trades at Just 22 Times Earnings -- and It's Growing Fast was originally published by The Motley Fool
Yahoo
10 hours ago
- Business
- Yahoo
Broadcom Takes Aim at Nvidia With New AI Networking Chip
Broadcom (AVGO, Financials) just rolled out a powerful new networking chip called Tomahawk Ultra, and it's built with one goal in mind helping AI systems talk to each other faster and at scale. Think of it like a traffic cop for data racing between hundreds of processors packed inside modern data centers. Warning! GuruFocus has detected 5 Warning Signs with AMD. And it's not just any chip. Broadcom says it can connect four times more chips than Nvidia's (NVDA, Financials) competing NVLink Switch and does it using a supercharged version of Ethernet instead of proprietary tech. We designed this originally for high-performance computing, but it turns out it's perfect for AI, too, said Ram Velaga, a senior exec at Broadcom. The chip is already shipping and built using Taiwan Semiconductor Manufacturing Co.'s 5-nanometer technology. AI models are getting bigger, and to keep up, companies need to connect more chips together fast and efficiently. That's where this chip comes in. Broadcom's solution allows developers and data centers to scale up, linking processors sitting just inches apart so they can act as one big brain. It's also part of a bigger trend: Broadcom, which already helps Google (GOOGL, Financials) build custom AI chips, is quietly becoming one of the few serious challengers to Nvidia in the AI infrastructure race. This article first appeared on GuruFocus.
Yahoo
14 hours ago
- Business
- Yahoo
These Stocks Have Soared 700% or More in the Last 5 Years and Could Still Crush the Nasdaq by 2030
Key Points Nvidia is driving the adoption of AI across the global economy. Broadcom's custom AI chip business is booming. 10 stocks we like better than Nvidia › The tech sector has historically been a hotbed for monster growth stocks, and that continues to be the case as artificial intelligence (AI) takes over the global economy. It's no surprise that some of the best-performing stocks in recent years have been leading chip companies. But the investment in AI is just getting started. Nvidia (NASDAQ: NVDA) and Broadcom (NASDAQ: AVGO) continue to see robust demand for their AI products. The tech-heavy Nasdaq Composite (NASDAQINDEX: ^IXIC) has doubled over the last five years, but these chip stocks have significantly outpaced it and could beat it again over the next five years. 1. Nvidia Shares of Nvidia have rocketed almost 1,500% since July 2020. However, it's still growing revenue and earnings at rates that can justify more highs for the stock. After falling with the broader market earlier this year, the stock has surged to record highs. Nvidia posted a 69% year-over-year increase in revenue last quarter, driven by strong demand for its new Blackwell computing system for advanced AI workloads. "Countries around the world are recognizing AI as essential infrastructure -- just like electricity and the internet -- and Nvidia stands at the center of this profound transformation," CEO Jensen Huang said. Huang is a CEO worth betting your money on. For more than two decades, Nvidia's main business was making graphics cards for PCs and video game consoles. But Huang expanded the company's addressable market to high-performance computing markets like data centers, which today make up nearly 90% of Nvidia's revenue. Nvidia is now one of the most profitable companies in the world. Over the last year, it earned $77 billion in net income on $148 billion of revenue, representing a sky-high margin of 51%. The company is reinvesting those profits in more innovation. Nvidia is already ramping up its Nvidia GB300 NVL72 platform, which features 72 Blackwell Ultra graphics processing units (GPUs) and 36 Arm-based Nvidia Grace chips. This new Blackwell Ultra computing system was built for next-level AI reasoning, providing a 50-times jump in AI factory output. The number of chips on these systems tells you why Nvidia's margins are so high. It is packaging together a bunch of state-of-the-art chips into a single platform and selling it for a premium. Apple is reportedly set to spend $1 billion on 250 GB300 systems. Current Wall Street estimates have Nvidia's revenue and adjusted earnings growing at an annualized rate of 20% through 2030. The stock trades at a forward price-to-earnings (P/E) multiple of 38 on this year's estimate, but the P/E drops to 22 on 2030 estimates. Nvidia stock should continue to follow earnings, potentially doubling the stock within the next five years. 2. Broadcom Nvidia isn't the only way to play the growth in AI infrastructure. There's also tremendous demand for custom AI accelerators, software, networking, and security solutions, which is benefiting Broadcom. The stock rocketed 762% over the last five years. While it may not match that performance over the next five years, it could at least double. The company's revenue grew 25% year over year last quarter. AI chip revenue alone grew 77% year over year, and management's outlook calls for more growth in custom AI accelerators, or XPUs, and networking products for data centers. Broadcom is in a great position to meet growing demand for faster data transfer speeds for advanced AI workloads. Its new Tomahawk 6 Ethernet switch offers 102.4 terabits per second of capacity to improve computing performance. Moreover, Broadcom expects three existing customers for its AI XPUs to deploy 1 million accelerated clusters by 2027. This demand should continue to benefit Broadcom's profitability. Management has a long record of investing in opportunities that generate growing free cash flow. Last year, Broadcom generated $19 billion in free cash flow on $51 billion of revenue. By fiscal 2029 ending in October, analysts expect free cash flow to reach $64 billion, representing a compound growth rate of 27%. The stock is trading at 36 times this year's free-cash-flow estimate, which is justified considering the opportunity ahead. Given the insatiable demand for AI infrastructure, Nvidia and Broadcom are not likely going to experience a slowdown in demand for their cutting-edge technologies anytime soon. AI should power the chip industry to record revenues in the coming years. Based on analysts' estimates, investors can expect Broadcom stock to double by 2030. Should you invest $1,000 in Nvidia right now? Before you buy stock in Nvidia, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $671,477!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,010,880!* Now, it's worth noting Stock Advisor's total average return is 1,047% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of July 14, 2025 John Ballard has positions in Nvidia. The Motley Fool has positions in and recommends Apple and Nvidia. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy. These Stocks Have Soared 700% or More in the Last 5 Years and Could Still Crush the Nasdaq by 2030 was originally published by The Motley Fool
Yahoo
14 hours ago
- Business
- Yahoo
Broadcom launches new Tomahawk Ultra networking chip in AI battle against Nvidia
By Max A. Cherney SAN FRANCISCO (Reuters) -Broadcom's (AVGO) chip unit unveiled on Tuesday a new networking processor that aims to speed artificial intelligence data crunching, which requires stringing together hundreds of chips that work together. The new chip is the latest piece of hardware that Broadcom has brought to bear against rival AI giant Nvidia (NVDA). Broadcom helps Alphabet's Google (GOOG) produce its AI chips, which are perceived by developers and industry experts as one of the few viable alternatives to Nvidia's powerful graphics processors (GPUs). Dubbed the Tomahawk Ultra, Broadcom's chip acts as a traffic controller for data whizzing between dozens or hundreds of chips that sit relatively closely together inside a data center, such as inside a single server rack. The chip aims to compete with Nvidia's NVLink Switch chip which has a similar purpose, but the Tomahawk Ultra can tie together four times the number of chips, Ram Velaga, a Broadcom senior vice president, told Reuters in an interview. And instead of a proprietary protocol to move the data, it uses a boosted-for-speed version of ethernet. Both companies' chips help data center builders and others tie as many chips as possible together within a few feet of each other, a technique the industry calls "scale-up" computing. By ensuring close-by chips can communicate with each other quickly, software developers can summon the computing horsepower necessary for AI. Taiwan Semiconductor Manufacturing will manufacture the Ultra line of processors with its five nano-meter process, Velaga said. The processor is now shipping. It took Broadcom's teams of engineers roughly three years to develop the design, which was originally built for a segment of the market known as high-performance computing. But as generative AI boomed, Broadcom adapted the chip for use by AI companies because it is suited to scaling up. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
