Citi Raises Broadcom Price Target to $500 on AI Demand

Citi analyst Atif Malik raised Broadcom's (NASDAQ:AVGO) price target to $500 from $475 on Tuesday, maintaining a Buy rating. The adjustment came in an earnings preview note, where the analyst indicated that stronger AI demand could drive the April quarter results modestly above estimates.

Rating Change

• Previous Rating: Buy with a $475 price target
• Current Rating: Buy with a $500 price target
• Upside: The new target implies approximately 5.3% upside from the previous target.

Analyst Rationale

Malik highlighted that increasing demand for AI chips from Broadcom's key customers, such as data centers, is boosting revenue expectations. He also noted that the company could benefit from the expansion of generative AI technologies, supporting growth in its semiconductor business.

Context

Broadcom's stock has risen over 30% year-to-date, fueled by the AI boom. Other analysts, including those at Morgan Stanley and Goldman Sachs, also have Buy ratings on the stock, with targets ranging from $480 to $520.

What to Make of This

The price target raise from Citi reflects growing confidence in Broadcom's ability to capitalize on the AI wave. However, investors should watch the Q2 results, expected in June, to assess whether these expectations materialize.