Is Broadcom Avgo One Of The Best Performing Ai Stocks To Invest In

Bonisiwe Shabane

-Dec 2, 2025, 1:12 AM

is broadcom avgo one of the best performing ai stocks to invest in

You missed Nvidia stock at $150. You are terrified Palantir is a bubble at 100x sales. You want AI growth, but you don’t want to lose your shirt if the hype cycle breaks. Speaking of bubbles, see How The $10 Trillion AI Bubble Pops. While the market obsesses over who builds the fastest race car (Nvidia), Broadcom has quietly bought the toll roads and the engine factory. It is the single best risk-adjusted bet in the entire AI ecosystem because it runs a "Double Moat" strategy that effectively hedges itself.

You aren’t just buying a chip stock; you are investing in a high-quality, diversified AI infrastructure and software company with strong moats and sticky customers. Separately, see the $370 Billion Question: Will Palantir Stock Crash? The Business Model: The "Mullet" Strategy Broadcom is the financial equivalent of a mullet: Boring in the front, AI Party in the back. This structure could give it a lot more downside protection than a pure high‑beta AI software story like Palantir. We recently published 10 Best AI Stocks to Buy According to American Politicians.

Broadcom Inc (NASDAQ:AVGO) is one of the best AI stocks to buy. On Sept. 17, Congressman Cleo Fields bought Broadcom Inc (NASDAQ:AVGO) shares worth between $15,001 – $50,000. The semiconductor giant’s shares are up about 7% since then. According to disclosures made in October, US Representatives Ro Khanna and Michael T. McCaul also bought stakes in Broadcom Inc (NASDAQ:AVGO).

The stock has gained 10% since these transactions. Polen Focus Growth Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its third quarter 2025 investor letter: “In early August we initiated positions in both NVIDIA and Broadcom Inc. (NASDAQ:AVGO), after having not owned either company over the past 2½ years following the initial wave of enthusiasm around Gen AI. While we have long admired both companies, their highly cyclical business models have made it extremely difficult to forecast future earnings growth with any degree of conviction.

Given our approach of seeking durable and persistent earnings growth that compounds over long holding periods, our concern in holding either was that we would be forced to endure a punishing downcycle within our... In fact, pre ChatGPT, NVIDIA had two punishing down cycles over the preceding five years. That is specifically what has occurred for NVIDIA and Broadcom. While the sheer magnitude of demand for AI chips, servers and networking equipment was something that we clearly underappreciated, new incremental data points over the past few months lead us to conclude the current... Semiconductor giant Broadcom NASDAQ: AVGO has lost some of its luster over the past several weeks. Since hitting an all-time high of nearly $386 on Oct.

29, Broadcom shares are down around 10% year-to-date. However, big tech spending projections are a reason for optimism going forward. A report from CreditSights helps highlight this. CreditSights is part of Fitch, one of the world’s top credit rating agencies. Below, we’ll dive into why this analysis provides positive support for Broadcom’s outlook. Broadcom’s growth relies significantly on the growth in capital expenditure (CapEx) spending from hyperscalers.

The world’s top five hyperscalers are generally accepted to be: Notably, CreditSight estimates that total CapEx among these top five hyperscalers will increase by 36% to $602 billion in 2026. They believe “unprecedented AI infrastructure investments" will drive this. Simply put, this higher spending would significantly increase the addressable market through which Broadcom can generate sales, supporting the firm’s 2026 outlook. Sundry Photography/iStock Editorial via Getty Images The AI ecosystem's pivot from training to inference is now emerging as a strong revenue engine for hyperscalers, which is a structural tailwind for Broadcom's (AVGO)(AVGO:CA) custom silicon and networking

Special Black Friday Sale, with a 20% discount off all Tech Insider Network subscriptions. Offer begins November 12th and ends December 3rd. 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. 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. Alphabet's stock has been on a roll lately.

One big beneficiary of that move? Broadcom. The rise in shares of Alphabet, Google's parent company, has helped inject some energy back into a flagging AI trade. That's had knock-on effects on a range of tech stocks—though few have benefitted as much as Broadcom (AVGO), which counts Google as a major customer for its AI chips. Broadcom's shares have surged recently, climbing along with Alphabet's (GOOGL, GOOG), which have been lifted by a series of positive developments for the cloud giant from a vote of confidence from Warren Buffett's Berkshire... Alphabet and Broadcom are seeing their shares advance at a time when some AI favorites like Nvidia are flagging.

That could point to some shifts to watch in the AI trade's biggest gainers—and the competitive landscape for chips. Alphabet shares advanced around 2% to finish at a fresh high Tuesday, and have added about 17% since Berkshire's stake was revealed in a regulatory filing a little over a week ago. Daily stocks & crypto headlines, free to your inbox By continuing, I agree to the Market Data Terms of Service and Privacy Statement Broadcom Inc. (NASDAQ:AVGO) is one of the AI Stocks Making Headlines on Wall Street.

On November 25, Goldman Sachs reiterated the stock as “Buy” and raised its price target on the stock to $435 per share from $380. With Broadcom set to post earnings Dec. 1, analyst James Schneider anticipates investor focus to be on FY26 AI revenue guidance, contributions from Google and OpenAI, and gross margins as custom XPU shipments scale. Expectations for the quarter are quite high, with updated guidance likely to exceed the previous forecast of 100% yoy AI revenue growth. Schneider anticipates AI revenue for fiscal year 2026 to come at $45.4 billion, an estimated year-over-year rise of 128%. This could reach $77.3 billion in 2027, increasing 70% year over year.

With Broadcom helping Google parent design its in-house specialized AI chips, investors are also going to be looking at Google and OpenAI contributions next year, in addition to Broadcom’s margin progression in 2026. Written by Keithen Drury for The Motley Fool-> Broadcom (NASDAQ: AVGO) is a popular pick in the artificial intelligence (AI) investing world. However, it's not as clear-cut as investing in Nvidia or Palantir, as both of these companies derive a significant chunk of their revenue through AI offerings. Broadcom's product line has a far broader reach, which makes it a more diversified investment. However, diversification can also cause a company to miss out on some massive tech movements.

So, is Broadcom a great AI pick? Or is its product line too widespread to benefit from this generational shift? If you look at Broadcom's product page on its website, you may get overwhelmed by the sheer number of choices it presents. It offers both hardware and software, such as cybersecurity and mainframe software, as well as connectivity products. Its biggest software product came as an acquisition when it purchased VMware. VMware provides its clients with virtual desktop services via the cloud and doesn't have much to do with AI, even if it is a useful service.

VMware is also a major reason Broadcom is showing revenue growth.

Is Broadcom Avgo One Of The Best Performing Ai Stocks To Invest In

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