Key Takeaways
- Broadcom’s fiscal Q3 2026 earnings announcement scheduled for September 2 following market hours.
- J.P. Morgan maintains Buy recommendation with $580 target price for AVGO.
- Analyst consensus forecasts EPS reaching $3.22, representing 90.5% annual growth, with revenue projected at $29.24 billion, climbing 83.3%.
- BakerAvenue’s King Lip identifies AVGO as a premier investment opportunity, emphasizing its dominance in custom AI processors and inference computing.
- Analyst community consensus stands at Strong Buy, with average target price of $511.88, suggesting 38% potential appreciation.
The semiconductor giant Broadcom is preparing to unveil its fiscal third-quarter financial performance this Wednesday, September 2, following the market close. Currently, AVGO shares are changing hands more than 25% beneath their peak levels achieved earlier this year.
Financial analysts on Wall Street anticipate the semiconductor company will deliver earnings per share of $3.22, marking a substantial 90.5% increase compared to the previous year. Total revenue projections stand at $29.24 billion, representing an 83.3% surge from the corresponding quarter twelve months prior.
Harlan Sur, an analyst at J.P. Morgan, has reaffirmed his Buy stance on AVGO in advance of the quarterly disclosure, maintaining his $580 price objective. Sur holds the No. 17 position among over 12,500 analysts monitored by TipRanks, boasting a 70% accuracy record and delivering an average 42.2% return per recommendation.
According to Sur’s analysis, the quarter’s performance will likely be propelled by the early deployment of next-generation TPU v8i processors alongside sustained momentum in TPU v7 products. He additionally anticipates contributions from Meta Platforms‘ MTIA Iris ASIC expansion and robust demand for Broadcom’s Tomahawk 5 switching solutions.
Looking forward, Sur projects FY26 AI-related revenue will surpass $56 billion, supported by an accelerated second-half rollout of TPU v8i and substantial networking demand, including the recently launched Tomahawk 6 102T switching platform.
Partnership Worries With Google Dismissed by Analysts
AVGO shares have advanced merely 7% since the beginning of the year, significantly trailing the PHLX Semiconductor Index’s impressive 61% gain during the identical timeframe. Sur attributes this relative weakness to market anxiety regarding possible market share erosion at Google and uncertainty surrounding FY27 AI revenue projections.
However, Sur maintains these worries are exaggerated. He references industry intelligence gathered during the past 90 days indicating Broadcom’s strategic standing with Google remains secure. The recent collaboration between Google and Marvell Technology, according to Sur, represents Google’s strategy to expand its partner ecosystem supporting its in-house chip development rather than displacing Broadcom. A five-year partnership agreement executed in early April solidifies Broadcom’s role as Google’s principal TPU collaborator.
Critical questions awaiting resolution during Wednesday’s earnings conference include whether leadership will revise its FY27 AI revenue projection, presently guided above $100 billion, and what signals the organization provides regarding trajectory into FY28.
Investment Community Highlights AVGO for Inference Computing Leadership
King Lip, chief strategist at BakerAvenue, has similarly designated AVGO as a preferred investment choice before the earnings release, highlighting a fundamental transformation in AI infrastructure investment patterns. He identifies an industry migration from training-centric workloads toward inference applications, where specialized processors manage large-volume, recurring computational tasks.
“Nvidia has been great for training models, but for huge repetitive type workloads, AVGO is our top pick for the next evolution in custom AI chips and inference play,” Lip told CNBC.
Lip emphasized that Nvidia’s success doesn’t necessitate decline for Broadcom to thrive. The two companies address distinct segments within the AI hardware ecosystem.
Additionally, Broadcom distributes a dividend yielding 0.71%, enhancing its attractiveness for investors with extended investment horizons.
The collective Wall Street perspective on AVGO remains at Strong Buy, featuring 25 Buy recommendations alongside 3 Hold ratings. The consensus price target of $511.88 implies approximately 38% appreciation potential from present trading levels.
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