Broadcom shares gained about 5% in early trading Wednesday, following a comparable increase before the market opened. Investors assessed improving AI infrastructure sentiment, evidence of sustained computing demand and Broadcom's expanding participation in the AI ecosystem. The SPDR S&P 500 ETF Trust gained about 0.7% in early trading. The VanEck Semiconductor ETF advanced about 2.7% during early trading.
CoreWeave CEO Michael Intrator said renewing contracts for older Nvidia GPUs through 2028 could produce nearly $10 billion in additional annualized revenue without further hardware capital spending. Intrator said third-quarter rental prices for older Ampere and Hopper GPUs rose 30%-50%. Intrator said more than 300,000 GPUs are expected to become available for new contracts through 2028. The comments focus attention on sustained demand throughout the AI infrastructure supply chain, where Broadcom operates.
Broadcom belongs to a group of seven cornerstone investors participating in a separate $26 billion private placement associated with Anthropic's planned Nasdaq listing under the symbol ANT. Alphabet, Nvidia and other large technology companies also belong to the group. Yorkville Ives analyst Dan Ives said Anthropic's offering could benefit the technology sector. Ives said the cornerstone group may be particularly important because major AI chip, infrastructure and distribution partners would become Anthropic shareholders before public trading begins.
Aureus Asset Management co-founder and Chair Emerita Karen Firestone said Firestone bought more Broadcom after the semiconductor selloff reduced Broadcom's valuation to roughly 11 to 12 times forward earnings. Firestone said the price decline offered an opportunity to expand a previously small position. Firestone said investors appear to prefer more measured, rational AI infrastructure spending while technology companies and regulators reconsider new data-center development.
Broadcom's share price stands 6.2% above the 20-day simple moving average of $329.10. However, Broadcom's share price remains 4.4% below the 100-day simple moving average of $365.71. Broadcom's share price also stands 4.8% below the 200-day simple moving average of $367.12. The 50-day simple moving average continues to sit below the 200-day simple moving average after a death cross in October. Broadcom's relative strength index reads 49.30, indicating neutral conditions. Broadcom faces key resistance at $352.50. Broadcom has key support at $343.00.
Broadcom's earnings release is scheduled for December 9. Analysts forecast earnings per share of $3.81, compared with $1.95 a year earlier. Analysts project revenue of $34.89 billion, compared with $18.02 billion. Broadcom's price-to-earnings multiple stands at 42.3 times. Broadcom has a consensus Buy rating and an average price forecast of $522.92.
Rosenblatt recently retained a Buy rating and a $600 price forecast for Broadcom. DA Davidson upgraded Broadcom to Buy and increased the price forecast to $400. Tigress Financial began coverage of Broadcom with a Buy rating and a $600 price forecast.
Broadcom accounts for 9.27% of the Invesco PHLX Semiconductor ETF. Broadcom represents 9.43% of the Pacer Data and Digital Revolution ETF. Broadcom has a 9.95% weighting in the Inspire 500 ETF. Those fund weightings expose Broadcom to broader fund flows as well as company-specific developments.
Benzinga Pro data showed Broadcom trading at $349.45, a gain of 5.26%, at publication on Wednesday.
Broadcom Stock Rises 5% Amid AI Infrastructure Optimism
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Summary
Broadcom (NASDAQ:AVGO) shares climbed nearly 5% in early trading as improved market sentiment lifted AI infrastructure stocks. Rising trading volume signaled strong investor interest. CoreWeave CEO Michael Intrator noted $10 billion in potential annualized revenue from older Nvidia GPU contracts through 2028. Broadcom also joined a $26 billion private placement for Anthropic’s Nasdaq listing. Analysts have upgraded or kept Buy ratings, with price targets from $400 to $600.
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