Key Stats for Broadcom Stock
- Price change for Broadcom stock in last 6 months: -21%
- $AVGO Stock Price as of Oct. 26: $329
- 52-Week High: $495
- $AVGO Stock Price Target: $529
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What Happened?
Bank of America, Blackstone, Citi, and Morgan Stanley will provide $63 billion in financing. The money will be used to buy Broadcom (AVGO) AI chips and networking gear for Anthropic.
It is one of the largest debt deals tied to the AI buildout.
Here is how it works. A new special purpose vehicle will buy Broadcom’s AI accelerators and networking equipment. It will then lease them to Anthropic and deliveries are expected to begin in 2027.
About $43.5 billion, or 69%, is first-lien senior debt. Bank of America, Citi, and Morgan Stanley are arranging that part.
Blackstone will provide the committed portion of the second-lien financing, which ranks below senior debt.
Broadcom is giving “residual value support” to lenders. In simple terms, that works like a guarantee, so if the equipment loses value, Broadcom helps cover it.
The release did not give a full breakdown of the loans.
This follows an earlier deal.
Apollo and Blackstone agreed to finance a $35 billion expansion for Anthropic, and Broadcom’s backstop in that deal was up to $29 billion.
Anthropic also filed for a potentially record-breaking IPO on Monday. Its filing showed steep losses and security concerns.
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What the Market Is Telling Us About Broadcom Stock
Investors are weighing big demand against growing risk. Broadcom stock sits at the center of a financing chain that is getting larger.
Moody’s called Broadcom one of the strongest large tech companies and also warned that risk would rise if many deals happen in a short time.
The demand side is strong. In its latest quarter, Broadcom’s revenue was $29.6 billion, up 86%.
AI semiconductor revenue was $16.7 billion, up 221%, while management expects fiscal 2027 AI revenue of about $115 billion.
Anthropic is a key customer. Broadcom expects it to deploy another 5 gigawatts of TPUs in 2027 and expects Anthropic to become its largest chip customer that year.
Broadcom has said it uses partners to underwrite these deals and also said any guarantees it offers would be modest and low risk. It gave no new details on its backstops in its latest call.
For Broadcom stock, the question is how much exposure builds up as these deals grow.
Anyone following Broadcom stock should watch Anthropic’s IPO and any new financing deals. Broadcom stock also depends on whether the labs it backs can pay their bills.
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So what is Broadcom stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
