Core Viewpoint - Broadcom's stock has surged 13% recently due to strong earnings, optimistic guidance, and a significant new order for $10 billion in custom AI chips, raising questions about its current valuation at $340 [2][3]. Group 1: Financial Performance - Broadcom's market capitalization stands at $1.6 trillion, with a diverse portfolio in semiconductor devices and software solutions [5]. - The company has experienced a revenue growth of 34%, increasing from $43 billion to $57 billion over the last 12 months, with an average growth rate of 24.1% over the past three years [6]. - In the most recent quarter, revenues grew by 20.2%, reaching $15 billion compared to $12.5 billion a year ago [6]. - Broadcom's last 12-month operating income was $21 billion, resulting in an operating margin of 37.5% and a cash flow margin of 40.7%, generating nearly $23 billion in operating cash flow [10]. - The net income for the same period was approximately $13 billion, indicating a net margin of about 22.6% [10]. Group 2: Valuation and Risk Assessment - Despite a high valuation, Broadcom's stock is considered attractive due to its strong operating performance and financial condition [3]. - The company's debt was reported at $67 billion, with a debt-to-equity ratio of 4.2%, while cash and cash equivalents amount to $9.5 billion of total assets of $165 billion, yielding a cash-to-assets ratio of 5.8% [10]. - Broadcom's stock has shown resilience during economic downturns, performing slightly better than the S&P 500 index [7]. Group 3: Stock Performance History - Broadcom's stock fell 36.7% from a high of $67.43 on December 27, 2021, to $42.71 on October 14, 2022, compared to a 25.4% decline for the S&P 500 [11]. - The stock fully recovered to its pre-crisis peak by May 18, 2023, and reached a high of $345.65 on September 8, 2025, currently trading at $336.67 [11]. - During the COVID-19 pandemic, the stock fell 48.3% from a high of $32.47 on February 12, 2020, to $16.79 on March 18, 2020, but also fully recovered by August 4, 2020 [11].