Broadcom’s Best Catalyst Yet Might Be Hiding in 2026 Forecasts

Core Viewpoint - Broadcom has experienced a decline in share price, down approximately 10% year-to-date since reaching an all-time high of nearly $386 on October 29, but there are optimistic projections for big tech spending that could positively impact the company's outlook [2]. Group 1: Capital Expenditure Insights - Broadcom's growth is heavily dependent on capital expenditure (CapEx) from hyperscalers, with total CapEx among the top five hyperscalers projected to rise by 36% to $602 billion by 2026, driven by significant investments in AI infrastructure [3]. - Analysts expect hyperscaler capital expenditures to increase significantly in 2026, which is favorable for Broadcom's growth prospects [4]. Group 2: AI-Specific Capital Expenditure - Isolating AI-specific CapEx reveals a more promising growth potential for Broadcom, as its products, including custom accelerators and networking chips, are directly influenced by AI spending [6]. - CreditSights estimates that approximately 75%, or $450 billion, of the total CapEx among hyperscalers will be allocated to AI in 2026, indicating a substantial growth opportunity for Broadcom [7].