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Is Broadcom Inc. (AVGO) the Best Technology Stock for Long-Term Investments?

Wesley ParkThursday, Jan 9, 2025 1:33 pm ET
4min read



Broadcom Inc. (AVGO) has been making waves in the technology sector, with its stock price soaring to new heights in recent years. But the question remains: is AVGO the best technology stock for long-term investments? Let's dive into the data and analyze the company's prospects to find out.

AVGO Trend


First, let's consider Broadcom's diversified business model. The company operates in two main segments: Semiconductor Solutions and Infrastructure Software. This diversification helps mitigate risks associated with market fluctuations and ensures a steady revenue stream. In the second quarter of 2024, Broadcom's Semiconductor Solutions segment grew by 7% to $30.1 billion, while its Infrastructure Software segment saw explosive growth, with revenue climbing nearly 200% to $5.82 billion. This balance between hardware and software sales makes AVGO a more stable investment compared to peers with more concentrated business models.



Another key factor driving Broadcom's long-term growth potential is its significant AI chip opportunity. The company's custom AI accelerator business, which sells into hyperscale cloud vendors like Google and Meta, is expected to make up close to half of Broadcom's overall sales by fiscal year 2028. Additionally, Broadcom's merchant switch and routing chip opportunity in AI is also strong, as the company dominates these markets at the highest speeds required for building generative AI models. This broad exposure to AI, combined with the company's strong position in networking, positions AVGO well to reap a meaningful share of AI investment over the next five years.

AVGO Total Revenue QoQ
Name
Date
Total Revenue QoQ%
BroadcomAVGO
20241231
7.51


However, it is essential to consider the sustainability of this trend. While AI is expected to be a significant driver of Broadcom's growth, the company's diversified business model provides a safety net against potential slowdowns in AI demand. Broadcom's exposure to AI is currently around 25% of its total sales, which helps mitigate the risk of overreliance on a single market segment.

In conclusion, Broadcom Inc. (AVGO) is an attractive long-term investment option due to its diversified business model, strong AI opportunity, and impressive financial performance. The company's ability to manage its diverse businesses effectively and adapt to changing market conditions positions AVGO well for sustained growth in the coming years. However, investors should remain vigilant and monitor the company's progress to ensure it continues to execute on its strategic initiatives and maintain its competitive edge in the rapidly evolving technology landscape.
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Lucas
01/09

Don’t miss out on this rare chance to take advantage of the market while prices remain accessible! Now is the ideal moment to position yourself ahead of the projected climb beyond $110K. While predicting market trends can be tricky, history shows that those who stay committed during critical periods often see the biggest returns.


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BrianNice23
01/09
@Lucas What’s your target entry point?
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Orion_MacGregor
01/09
@Lucas Bullish on AVGO, let's go!
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lies_are_comforting
01/09
AVGO's not just a stock, it's a mood. Riding that wave of growth feels good 😎
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dritu_
01/09
@lies_are_comforting AVGO's not just a stock, it's a mood? More like AVGO's the whole market vibe, right? 📈😎
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yeahyoubored
01/09
Diversification is key; AVGO's got hardware & software grind.
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LackToesToddlerAnts
01/09
@yeahyoubored True, AVGO's diversification is solid.
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tempestlight
01/09
Chip demand could slow; Broadcom's software saves the day.
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NoAd7400
01/09
Broadcom's AI play is 🔥 but watch out for dips.
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Argothaught
01/09
With 25% AI exposure now, Broadcom's got room to grow without being too eggshell-skinned. Smart play.
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BoomsRoom
01/09
The networking dominance at high speeds is like having a cheat code in the tech industry. AVGO's got that edge.
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Excellent-Win-4625
01/09
AVGO's AI chip game is strong, but can they keep up with Nvidia? The chip wars are far from over.
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jstanfill93
01/09
Broadcom's software growth is wild—nearly 200%? That's not a bug, that's a feature for long-term holders.
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MacaroniWithDaCheese
01/09
AVGO's growth is solid; long-term hold for me.
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Artistic_Studio2784
01/09
The question is, can Broadcom keep the engine running at full speed, or will they hit the brakes? Time will tell.
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Antinetdotcom
01/09
@Artistic_Studio2784 Do you think AVGO will slow down?
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HobbyLegend
01/09
$AVGO is my heavy hitter in the tech portfolio. Diversification and AI make it a solid long-term play. 🚀
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Repturtle
01/09
Diversification is key here. AVGO's not just riding the AI wave; they've got semis and software holding strong.
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Airmang74
01/09
Broadcom's AI play is 🔥, but can they keep up the growth pace? Watch for potential hiccups in their software segment.
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