Broadcom's Google Woes Overstated, JPMorgan Says
Broadcom's stock has been lagging behind the broader semiconductor group this year, but JPMorgan analyst Harlan Sur says concerns about the company's competitive position at Alphabet Inc are overblown.
Sur maintained an Overweight rating and price target of $580 for Broadcom's shares. He noted that much of the underperformance in Broadcom's stock stems from worries about potential share loss at Google longer-term.
However, Sur believes these concerns are unfounded, citing recent partnerships between Broadcom and Alphabet as well as Marvell Technology Inc. These partnerships, he said, are more reflective of Alphabet bringing on additional partners to support its internal COT team and TPU-attach opportunities.
Broadcom has a strong position as Alphabet's core TPU partner, secured through an agreement signed in early April. The deal commits Alphabet to annually increasing TPU-related purchases at Broadcom and anchors the company as the volume partner for the next four generations of TPU SKUs.