Broadcom (AVGO) Is Trading 25% Below Its Recent High: Here’s Why $454 Is the 12-Month Price Target

Core Viewpoint - Broadcom is projected to reach a price target of $454 by March 2027, driven by accelerating AI semiconductor revenue growth, despite current share price pullback [2] Group 1: AI Revenue Growth - Broadcom's AI semiconductor revenue has shown consistent growth, with reported figures of $4.1 billion in Q1 FY2025, $4.4 billion in Q2, $5.2 billion in Q3, and a guidance of $6.2 billion for Q4 [3] - For Q1 FY2026, management expects AI semiconductor revenue to double year-over-year to $8.2 billion, with projections from JPMorgan analyst Harlan Sur suggesting it could exceed $9 billion [3] Group 2: Free Cash Flow and Valuation - In Q4 FY2025, Broadcom generated $7.47 billion in free cash flow, with sequential growth throughout fiscal 2025 [4] - The company raised its quarterly dividend by 10% to $0.65 per share, indicating confidence in sustaining its cash generation trajectory [4] Group 3: Analyst Consensus - The consensus analyst price target for Broadcom is $454.43, with 48 buy or strong buy ratings and no sell ratings [5] - The average 12-month target has recently increased to $451.25, reflecting bullish sentiment among analysts [5]