TLDR
- Broadcom stock fell 14% in June but rose ~3% in premarket Wednesday after a bullish J.P. Morgan note
- J.P. Morgan reaffirmed its Overweight rating with a $580 price target, implying 54% upside
- Wolfe Research projects Broadcom’s XPU revenue could hit $250–$300 billion in fiscal 2028
- J.P. Morgan says the Google TPU partnership remains on track, pushing back on concerns about supply chain diversification
- Of 55 analysts polled by FactSet, 51 rate AVGO a Buy with an average price target of $523.67
Broadcom stock has had a rough June. After hitting a record closing high of $481.57 on June 2, the stock dropped 14% through the middle of the month, closing at $376.71 on Tuesday. But Wednesday morning brought some relief, with AVGO rising around 3.2% in premarket to $388.85.
The bounce came after J.P. Morgan analysts Harlan Sur and Mayur Ramdhani put out a note saying they would be “aggressive buyers at current levels.”
The bank reiterated its Overweight rating and kept its $580 price target — that’s 54% upside from Tuesday’s close.
Sur pointed to Broadcom’s position in advanced chip packaging design, its intellectual property portfolio, and its track record with major customers. He noted the company has helped Google bring 14 advanced chip designs to market over the past 12 years.
The Google relationship has been a point of concern for investors. CEO Hock Tan had flagged that Google was likely to diversify its chip supply chain, which rattled the market.
J.P. Morgan pushed back on that worry, saying there has been no delay or cancellation of the next-generation Google TPU program and that Broadcom remains on track for production.
The Alphabet partnership goes back a decade, covering eight generations of Google’s Tensor Processing Units.
Wall Street’s XPU Outlook
Wolfe Research added more fuel Wednesday. The firm said recent management meetings point to Broadcom’s XPU revenue reaching $250–$300 billion in fiscal 2028. Full funding from hyperscalers could allow Anthropic and OpenAI XPU volumes to triple to 15 gigawatts.
That’s a big number, and it’s reignited some investor confidence after a tough week for the chip sector.
Tuesday’s selloff wasn’t just a Broadcom story. Nvidia, Micron, AMD, Intel, and Marvell all dropped together in what was a broad semiconductor rout. AVGO shed 4.4% in that session alone.
The macro backdrop hasn’t helped. The FOMC is holding its first meeting under new Chair Kevin Warsh, with markets pricing in a restrictive stance given elevated inflation. The Nasdaq was down 1.2% and the S&P 500 off 0.6%, making Broadcom’s premarket recovery all the more eye-catching.
Analysts Stay Long-Term Bullish
Oppenheimer’s Rick Schafer, who rates the stock Overweight with a $535 price target, described the tone as “bullish” after a recent conversation with Broadcom executives.
Schafer said 2026 revenue is locked in with a “clear line of sight to deployments this year,” and that management expects AI revenue in the second half to double versus the first half.
“We remain long-term buyers,” he wrote, though he flagged that incremental upside is likely pushed to 2028.
Broadcom is targeting $100 billion in AI chip sales in 2027. It currently designs custom chips for six customers, including Alphabet and OpenAI. Nvidia still leads in AI computing, but Broadcom’s custom silicon business has grown steadily through the AI data center build-out.
Despite June’s drop, AVGO is still up 11% year-to-date and has gained 53% over the past 12 months. Its 52-week range runs from $244.17 to $495.00, with Wednesday’s premarket price of $383.21 sitting well below the top of that range.
Of 55 analysts tracked by FactSet, 51 rate the stock a Buy, with a consensus price target of $523.67.
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