Piper Sandler resumes Broadcom coverage with buy rating

Piper Sandler analysts resumed coverage of specialized chipmaker Broadcom with a buy rating and set a $460 price target. This implies upside potential of more than 25% from the current level, CNBC reports.

AI chips

Piper Sandler called Broadcom a leader in the segment of ASICs — application-specific integrated circuits — for artificial intelligence inference. According to the analysts’ estimate, the company holds 75% of this market, and most major cloud providers and AI labs work with it on ASIC development.

The analysts mentioned Google’s TPU tensor processors as a product currently being supplied in large volumes, as well as Alphabet’s expanded agreement with Anthropic on next-generation TPUs. They also positively assessed the ramp-up in production of Meta MTIA accelerators and OpenAI Jalapeno chips. Broadcom spoke about ties with all three companies at the beginning of the…