Broadcom: Joining The $1 Trillion Club

Summary:

• Broadcom’s stock surged due to exceptional 1Q25 results, joining the $1 trillion market valuation club, driven by AI advancements and a strong Apple partnership.
• Broadcom’s consistent profit outperformance, 51.2% YoY sales growth in 4Q24, and a bullish 1Q25 sales forecast highlight its robust financial health and growth potential.
• The multi-billion dollar Apple collaboration enhances Broadcom’s competitive edge in AI chip development, positioning it to rival Nvidia and drive future sales and profit growth.
• Despite a high valuation, Broadcom’s long-term growth prospects in AI and custom chips justify a potential 35x profit multiple, with risks tied to investor expectations and AI ROI.

The stock price of Broadcom Inc. (NASDAQ:AVGO) has gone through the roof last week, after the semiconductor company reported much better-than-expected results for the first quarter of its 2025 financial year.

I recommended Broadcom in my piece Broadcom: A

Analyst’s Disclosure: I/we have a beneficial long position in the shares of AVGO either through stock ownership, options, or other derivatives. 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.

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.