Broadcom Isn’t Delivering Nvidia-Type Beats. Why You Should Back Its AI Growth Anyway.
Broadcom is seen as a promising semiconductor player for artificial intelligence growth, following in the footsteps of Nvidia.
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Posted 9/1/2023, 8:39:00 AM
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Nvidia has established itself as a dominant force in the artificial intelligence industry by offering a comprehensive range of A.I. development solutions, from chips to software, and maintaining a large community of A.I. programmers who consistently utilize the company's technology.
Broadcom, a significant player in the semiconductor industry, is a promising investment option due to its strong performance, focus on artificial intelligence (AI), consistent growth, and attractive valuation. The stock's technical analysis suggests a bullish trend and potential buying opportunities, although there are risks associated with competition, market volatility, supply chain disruptions, and economic uncertainties. However, investors may consider buying the stock during price dips or a surge beyond its record high to capitalize on Broadcom's growth and industry relevance.
Nvidia's CEO, Jensen Huang, predicts that the artificial intelligence boom will continue into next year, and the company plans to ramp up production to meet the growing demand, leading to a surge in stock prices and a $25 billion share buyback.
Semiconductor stocks in Asia, including Taiwan Semiconductor Manufacturing Corp and Samsung Electronics, surged following Nvidia's strong quarterly results and optimistic guidance, driven by the demand for AI chips used in data centers and artificial intelligence applications.
Nvidia's strategic partnership with VMware in launching the Private AI Foundation could make VMware/Broadcom a better AI stock to buy than Nvidia, as it combines cloud computing infrastructure with semiconductors necessary for generative AI chips.
Nvidia's impressive earnings growth driven by high demand for its GPU chips in AI workloads raises the question of whether the company will face similar challenges as Zoom, but with the continuous growth in data center demand and the focus on accelerated computing and generative AI, Nvidia could potentially sustain its growth in the long term.
Nvidia, the world's most valuable semiconductor company, is experiencing a new computing era driven by accelerated computing and generative AI, leading to significant revenue growth and a potential path to becoming the largest semiconductor business by revenue, surpassing $50 billion in annual revenue this year.
Salesforce and Broadcom are expected to release their quarterly results this week, with investors interested in seeing if their investments in artificial intelligence are proving successful.
Artificial intelligence (AI) leaders Palantir Technologies and Nvidia are poised to deliver substantial rewards to their shareholders as businesses increasingly seek to integrate AI technologies into their operations, with Palantir's advanced machine-learning technology and customer growth, as well as Nvidia's dominance in the AI chip market, positioning both companies for success.
Semiconductor firm Broadcom (AVGO) beat Wall Street's expectations with its fiscal third-quarter financial results, posting an adjusted EPS of $10.54 on revenue of $8.876 billion, and despite pedestrian growth, the company is seen as a potential bargain due to its free cash flow and potential in the AI market.
Nvidia's stock has seen a 200% gain this year, highlighting the lucrative potential of the artificial intelligence trade.
Nvidia's head of enterprise computing, Manuvir Das, believes that the artificial intelligence (AI) market presents a $600 billion opportunity for the company, as demand for AI technology continues to fuel its growth, leading analysts to overlook its undervalued shares and potential for exceptional growth in the years to come.
Nvidia's success in AI hardware sales has raised speculation about the future of the company and the tech sector, drawing comparisons to past tech cycles driven by the internet and smartphones. The key question is whether other tech companies will successfully develop software and services to capitalize on Nvidia's AI gear.
Broadcom's stock dropped 6% after reports emerged that Google may drop the company as a supplier of artificial intelligence chips by 2027, with Google considering designing the chips in-house to save costs.
Despite a recent slip, semiconductor firm Broadcom's stock is still considered a strong buy due to its growing software business, stake in the artificial intelligence game, and positive insider buying activity, along with expectations of continued robust demand for semiconductors and AI advancements.