Could This Company Be the Next Nvidia, and Should You Invest?
Written by
Chris Adam
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Amber Barkley
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If you’ve done any exploring of investments in the world of artificial intelligence, you’re probably familiar with the company called Nvidia. It’s a mammoth in the world of AI chips. In fact, Fortune reported on Jan. 7, “Nvidia’s market cap is now greater than that of its leading competitors combined — and doubled — as it corners the market on chips for artificial intelligence.”
There’s been some recent talk about another company in the AI field, Broadcom, and the potential for it to become a huge success and follow in the footsteps of Nvidia. GOBankingRates talked to financial experts for their opinions on Broadcom, its potential and whether it makes for a solid investment.
What Is Broadcom?
Broadcom describes itself as “a global technology leader that designs, develops and supplies a broad range of semiconductor, enterprise software and security solutions.”
According to Investing.com, “While Nvidia has dominated the AI spotlight, Broadcom is making significant strides to challenge its throne.”
With a market capitalization over $1 billion, Broadcom partners with “tech giants like Google, Meta and ByteDance,” Investing.com reported. “Its deepening collaboration with OpenAI positions it to play a critical role in developing next-generation ChatGPT models.”
What Is Broadcom’s Future?
If your investment strategy involves some level of risk, a company like Broadcom can be an appealing target. It might be exciting to invest in a company that’s being talked about for its growth potential.
“In my experience, drawing comparisons between companies like Broadcom and Nvidia can be both insightful and risky,” said Shirley Mueller, finance expert and founder at VA Loans Texas. “It’s not fair to expect Broadcom to replicate Nvidia’s meteoric rise in AI, but its solid fundamentals and steady revenue streams make it a compelling candidate for investors who prefer a less volatile yet growth-oriented play in the tech sector.”
Mueller added that Broadcom has shown exceptional strength in the semiconductor space, particularly with its focus on connectivity, data infrastructure and enterprise solutions. While Nvidia has become synonymous with AI innovation and high-performance computing, Mueller said Broadcom’s strategy is more diversified, targeting long-term growth in areas like 5G, cloud infrastructure and software acquisitions.
According to Andrew Lokenauth, money expert and owner of Fluent in Finance, “I think Broadcom’s got serious potential, but maybe not quite Nvidia-level. It’s worth considering for a long-term tech portfolio.”
Should You Invest?
“When considering investing in Broadcom — or any individual stock — it’s important to assess its valuation, growth trajectory and your own portfolio’s diversification,” Mueller said. “Broadcom has a robust dividend yield, which can make it attractive for income investors, but growth-seekers should weigh whether its valuation leaves room for significant upside.”
Mueller suggested a layered approach: Start with small, incremental investments rather than going all in, and consider pairing Broadcom with broader ETFs or funds focused on technology and semiconductors.
According to Lokenauth, “The stock might be a bit pricey now, but that’s tech for you. You might want to wait for a dip to get in, if you’re patient.”
But Lokenauth agreed with much of what Mueller advised when it comes to investments. Overall, as is mostly the case with investing, Lokenauth advised not putting all your eggs in one basket. If you’re thinking about investing in Broadcom, perhaps you could mix it with other tech stocks and make it a part of a broader investment strategy focused on semiconductors.
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