Susquehanna analysts raised the price target for Broadcom (NASDAQ:AVGO) to $1,010 from $910 per share in a note Thursday, maintaining a Positive rating on the stock.
The analysts told investors in a note that they expect the company to post in line with slightly better second quarter results and guidance on Thursday, August 31.
They said that AI growth may offset softness in other segments for the company. "We're expecting in-line to slightly better results and guidance, as AI growth may overcome softness in traditional networking, broadband, wireless, and storage, and Broadcom's notorious lean channel inventories help pad," they explained.
"Still, traditional networking read-throughs suggest the near-term may be generally okay, as Arista and Cisco (NASDAQ:CSCO) posted better than expected results/guidance. Customer inventories remain a longer-term risk, as Arista plans to continue to build inventory through the year (still, Broadcom insists they do not over-ship here), and others have discussed inventory letting," the analysts added.
Overall, the firm remains optimistic about AVGO's franchise businesses, capital allocation, and integration strategy and is bullish on its opportunities in networking, optics, and AI, as "powerful long-term growth drivers."