Goldman Sachs revamps Broadcom stock price target with a twist

Broadcom’s (AVGO) banal looks virtually unstoppable, having jumped implicit 66% year-to-date arsenic it moves ever truthful adjacent to a $2 trillion valuation.

However, with specified momentum comes a caller benignant of pressure.

Goldman Sachs expert James Schneider conscionable bumped his terms people connected the stock, doubling down connected his bargain rating.

He frames Broadcom arsenic possibly the astir important “arms dealer” successful the AI boom.

At the aforesaid time, helium makes it wide that expectations for Q4 stay sky-high. Investors privation a beardown beat, a raise, on with a steadfast fiscal 2026 usher that tops the expected $11 billion+ successful AI sales.

Hence, adjacent though Broadcom could beryllium winning the AI hardware race, Schneider’s enactment underscores the situation up that erstwhile a banal runs this hard, adjacent large results tin beryllium disappointing.

Schneider bumped Broadcom's terms people from $380 to $435 (14.5% increase), arsenic it heads into Q4 with a setup that’s excessively beardown to ignore.

In the note, helium talked astir 3 areas that investors attraction astir the most.

These see the company’s AI gross guidance for 2026, the income publication from Google and OpenAI, and whether it tin support its lofty margins arsenic its customized XPU concern continues to turn astatine an unthinkable pace.

Related: Salesforce CEO sends astonishing connection connected Google's latest tech

Moreover, Schneider mentions that expectations stay elevated, particularly with the beardown adjacent results, peculiarly from Google’s latest Gemini 3 launch, relying heavy connected Broadcom-designed TPUs.

It’s worthy mentioning that pursuing its ascent, Broadcom banal present trades implicit 28-times guardant income and 55-times guardant currency flows.

Nevertheless, Goldman sees Broadcom little arsenic a beneficiary of AI hype and much arsenic 1 of the fewer businesses gathering retired the hardware instauration connected which everyone other relies.

Broadcom heads into Q4 with Mr. Market expecting different rock-solid performance, spearheaded by a fast-growing AI semiconductor business.

Consensus estimates bespeak net of astir $1.87 per stock connected sales of $17.0–$17.4 billion.

Broadcom’s ain $17.4 billion usher sits adjacent the apical of that range. Naturally, the tech giant’s AI spot conception is its astir important catalyst, which is projected to deed $6.2 billion successful Q4, up 66% twelvemonth implicit year, portion accounting for much than a 3rd of full sales.

Related: Billionaire Steve Cohen loads up connected apical AI stock, calms bubble fears

Infrastructure software, led by VMware, is besides expected to adhd $6.7 billion, increasing astatine a superb 15%.

Additionally, with a record $110 cardinal backlog, on with a recently revealed “fourth large AI customer” placing $ 10 billion+ successful orders, investors spot robustness rolling consecutive into adjacent year.