8 Best FAANG Stocks To Buy According to Analysts

4. Broadcom Inc. (NASDAQ:AVGO)

Analyst Upside as of October 22, 2024: 10.9%

Number of Hedge Fund Holders: 130

Broadcom Inc. (NASDAQ:AVGO) is a semiconductor company that designs, develops, and supplies semiconductor and infrastructure software products. Some of its products include cable modems, networking processors, and storage adapters.

2024 has been quite a feat for Broadcom Inc. (NASDAQ:AVGO). During the year, the company launched two breakthrough technologies such as the industry’s first switch platform for scalable AI systems and Retimers, facilitating the management of large datasets for AI tasks. To keep its strategy active, on October 15, Broadcom Inc. (NASDAQ:AVGO) expanded its 20-year partnership with Deutsche Telekom’s subsidiary, T-Systems. The subsidiary is now a VMware Cloud Service Provider.

On June 13, Nancy Tengler, CEO and chief investment officer of Laffer Tengler Investments, appeared in an Interview on Yahoo Finance where she shared her bullish stance on AVGO. Tengler states that AVGO is like the poor man’s NVIDIA and is part of her 12 best ideas portfolio. She adds that the company is in the sweet spot in the generative AI sector for both the hardware and software components.

As Tengler states, AVGO indeed is in a sweet spot for AI. In the fiscal fourth quarter of 2024, Broadcom expects revenue from AI to grow by 10% sequentially reaching $3.5 billion, bringing the full-year total to $12 billion. In addition to that, its cloud computing platform for enterprises promises a solid growth opportunity as AVGO leverages artificial intelligence.

ClearBridge Investments’ ClearBridge Large Cap Value Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its Q3 2024 investor letter:

“In IT, we bought Broadcom Inc. (NASDAQ:AVGO) as we believe the company has a long runway for growth with its custom silicon business, which should be more durable and less volatile than other components within the AI food chain. We also believe the acquisition of VMware creates another opportunity for steady, subscription-based durable growth that is still in its early innings. We believe the stock has an attractive risk/reward profile given the reasonable visibility toward mid-teens EPS growth at a low-20s P/E multiple. We made room for Broadcom by exiting Lam Research, whose shares we believed priced in a full recovery, while we grew increasingly concerned that China exposure might create an air pocket.”