저자: Kartik · 외국인
요약 보기
브로드컴은 AI 커스텀 ASIC과 네트워킹 칩에서 강한 해자를 가진 구조적 수혜주로, 엔비디아 방식의 700~800억 달러 금융지원 딜이 AI 칩 수요를 뒷받침한다고 주장. 25% 하락한 현 시점을 장기 매수 기회로 보며, 공정가치를 270~370달러로 제시하고 350달러 부근 소량 진입, 300달러 이하 분할매수를 제안. 반면 Marvell 경쟁, 고객 집중도, 경기순환 및 부채 리스크를 언급. 9/2 실적 발표 후 공정가치 재계산 예정.
다듬은 글
Hello everyone! With you Kartik and Money Buzz. Let's talk about Broadcom shares in today's video. We will consider a complete fundamental analysis. I'll also touch on the $70-80 billion deal that Broadcom is expected to make to essentially fund and support these AI labs, very similar to what Nvidia did with half a trillion dollars.
And Broadcom is also expected to change course when Nvidia reports its earnings this week, right? So , on Wednesday, August 26, Nvidia will report its earnings, and we will be watching, of course, how Nvidia moves, as well as how Broadcom behaves. It's a bear market right now, so it's down a little over 25%, and Broadcom will report on September 2nd.
This will be next week for the period ending in July. So, this is also going to be a very, very important earnings report for this company. It is also part of our shopping list. She also recently won our stock vote. We have a special Discord channel in our community for stock suggestions. You can suggest a stock you want to analyze.
And if it gets the most votes, we analyze it. And this week we'll look at Broadcom. So be sure to like and subscribe to the channel. Again, the link will be at the bottom if you are interested in joining our Money Vest community with a 40% discount on an annual subscription. It expires in 7 days. So at the end of this month it will no longer be valid.
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So, if you have any questions, reach out, and let's dive into the Broadcom review. First of all, I want to talk very briefly about what Broadcom actually does. Broadcom is known as the nervous system and the framework for data transfer and how chips essentially communicate with each other, right? They essentially provide the architecture of ownerless mega- industries.
It doesn't manufacture chips like TSMC does, nor is it the " muscle" or computing power for data centers like Nvidia, but Broadcom provides connectivity, communications, and custom solutions by providing intellectual property, block diagrams, and platform interfaces that drive data transfer. So , semiconductor solutions, which account for 58% of revenue, are primarily network technologies and switching.
These are Tomahawk and Jericho routing chips, custom ASICs, and specialized integrated circuits with optical connectivity. If data is transmitted within a cloud data center, iPhone, or Wi-Fi router, Broadcom's infrastructure handles it, as does the infrastructure software. So, 42% of revenue is largely provided by the acquisition of VMware.
This segment virtualizes corporate data centers, creating a stable enterprise software ecosystem that also “ties ” customers to hybrid clouds managed by Broadcom. So, if we consider their "moat" - a competitive advantage , right? Is this " moat" a reliable defense? Reliable security is very important to the company, and Broadcom has it extremely strong.
When hyperscalers like Google , Meta, or ByteDance want to build their own chips to avoid Nvidia's high prices, they don't start from scratch. They use off-the-shelf intellectual property blocks from Broadcom. That, along with Marvell, accounts for about 95% of the market, right? We see that Broadcom owns 60% of the custom AI ASIC development market, and together with Marvell they control 95% of this segment.
Networking standards— Broadcom switches and optics in a shared chassis define how thousands of AI chips communicate with each other. This is intra-cluster communication, and you can't just replace a Broadcom switch without redesigning the physical structure or software stack of the entire data center.
In addition, the strategy of the CEO of Broadcom is to buy critically important technology companies. As you know, they acquired CA Technologies, Symantec, VMware, selling non-core assets, raising prices for core products, and “ locking” customers into long-term corporate agreements . This is what the company does.
That's where their advantage lies. Now let's talk about the $70-80 billion deal that Broadcom is making. This is very similar to what Nvidia has done with other platforms, providing financing to neo- cloud and AI companies that purchase GPUs, being able to use those GPUs as collateral and guarantee the loan.
So, this is a very interesting example of financial engineering in general, isn't it? So Nvidia, for example, is raising half a trillion dollars, telling lenders, “ Look, our GPUs are really good. They are the best in the world and retain their value. They are very productive. These are income-generating assets, if you look at it from that angle." So provide funding to companies like cloud AI services, neo- clouds, to all those who want to build data centers, give them capital.
They will use this capital to buy our chips, and our chips will become collateral for your loan. This is cyclical trading, and that's what Broadcom is doing as well. So, the $70-80 billion debt package, which was again reduced from around $100 billion — the initial financial package was around $100 billion — is now expected to be closer to $70 billion in the current round of restructuring.
And again, Broadcom's debt financing deal for AI chips is expected to reach over $70 billion. The figure of 70 billion fits within the initially announced range and does not indicate a reversal. And again , it was somewhere between 60 and 100 billion. So we're looking at 70 billion as a likely final amount within that range for this deal.
Moreover, the funding is still focused on the same goal: financing the production of custom AI chips for Anthropic and OpenAI, as well as the development of the AI XP V investment vehicle that Broadcom launched with both labs in June. So, very quickly, here's a quick overview. Building a 20 gigawatt AI data center requires tens of billions of dollars upfront.
AI startups have huge capitalization, but cannot easily borrow tens of billions of dollars from traditional banks due to a lack of physical collateral. And this is where Broadcom and Nvidia come into play. A special purpose vehicle (SPV) issues debt. Broadcom is providing support , essentially guaranteeing a portion of this senior debt to give it an investment grade rating and lower its borrowing costs.
Apollo and Blackstone are the two main underwriters that essentially provide this service. So, we are looking at a debt package of $70–80 billion. This money is used to purchase and build custom AI chips and infrastructure developed by Broadcom, and the equipment is then leased to Anthropic and OpenAI.
So yes, it's a bit like cyclical trading. Again , Broadcom is mobilizing capital for these AI labs, which can then borrow money to buy or build their own specialized chips with Broadcom and Marvell, and then install them in data centers that they can lease to corporate customers, start generating cash flow and profits, and of course repay the loan, which is again secured by collateral in the form of specialized chips.
I also wonder why Broadcom is doing this and what differentiates Broadcom from Nvidia, which could arguably become a true “ tools provider” for the industry in the long run, because Nvidia GPUs are very expensive, right? They are in such high demand that they are very expensive, and developing a specialized chip from scratch with Broadcom or Marvell is a slightly cheaper option, at a much lower price, right?
So, this is another important way to make money from providing infrastructure. And that's why I'm very optimistic about Broadcom. This is a position I view as a long-term investment. I have traded Broadcom shares before, earlier this year. It worked really well, and now I'm thinking : OK, I want to form a long-term position in Broadcom.
We see guaranteed orders that give Broadcom an absolute monopoly on the market for specialized chips for Anthropic and OpenAI , in addition to Nvidia products. Off- balance sheet scaling allows AI labs to exponentially grow their computing power without burdening their own balance sheets with huge equipment debt and bypassing capital constraints.
Broadcom guarantees instant implementation of its specialized chips because it has created a financial instrument for purchasing its own products. It's interesting that Nvidia and Broadcom are creating these financial mechanisms and mobilizing capital to provide it to these companies to buy their own products, you know?
In fact, they simultaneously create both the supply of capital and the demand for their own product. So we literally give you money to buy our product , that's crazy, right ? We don't just give money, we provide the opportunity to borrow it to buy our product again, where the product itself serves as collateral.
Again, this is very interesting. This is one of the first times we see the semiconductor industry taking such steps. So, the bullish scenario is a market takeover by specialized chips, right? This is the main argument in favor of growth. So, ASICs have reached a tipping point, replacing general- purpose GPUs.
Nvidia GPUs are known to be expensive and power-hungry. Hyperscalers are aggressively moving to specialized, cost-effective custom ASICs to power AI models. And again, these shipments are projected to grow by 44.6% per year, which is almost three times faster than the growth rate of standard GPUs. We have huge orders for AI, so Broadcom is on the cusp of success, aiming for $100 billion in annual revenue from AI semiconductors by 2027.
They are the main providers of tools for building the generative AI network backbone . We are not talking about direct competition with Nvidia, but about special AI chips that are capable of transmitting data. It's like the nervous system and skeleton of the cloud clusters, or data centers, that these companies are building.
The threat from Marvell is significant, as the dependence on them in the development of these chips is also very high. So, Broadcom's positions are being challenged quite harshly. Competitor Marvell Technology recently expanded its presence in the custom chip space with Google. And since Broadcom is heavily dependent on several cloud giants like Google, Meta, and OpenAI, losing any development cycle to Marvell is a multi-billion dollar loss.
Of course, cyclicality and debt risks will also always be present. The semiconductor industry in general is very cyclical, if we talk about the business cycle. There is also a debt risk, because a lot of things are financed by GPUs and these chips, which are not always able to be leased to business customers.
In the event of any downturn, reduction in sales or revenue, no one wants a situation where companies start to default or, worse, find themselves with negative equity because the value of the chips is lower than the debt for them. But, despite this, I believe that Broadcom is a great long-term opportunity, considering all the positive and negative scenarios.
Where would I personally consider buying shares? I already mentioned that the fair value for Broadcom is around $325 and below $300. This remains the case, but I wouldn't mind starting to form a position in the $350 range. It might even be worth selling a put option at 350 and then averaging the stock price as it falls further.
The price has already fallen by 25%, and a drop below $325 or $324 would see a total decline for Broadcom of 34% to over 42%. So , those are going to be a few levels of support to look out for for Broadcom, right? So we have 324, 325, all the way down to below 300, which is 280 to 290. These are also very important levels to watch for Broadcom.
Let's talk a little bit about where we are in terms of fair value. Let's quickly calculate this for ourselves. Now let's move on here to Broadcom and look at the fundamental analysis. Given analysts' estimates, we see very high growth rates. So , from $11.59 to over $35 per share, right? So we're seeing a compound annual growth rate of 49%, which is just incredibly high, right?
Absolutely ridiculous. But the forward P/E ratio is now over 31, almost 32. And of course, it's coming down to over 10.5, which again continues to decline because the growth rate is so strong and Broadcom's earnings are just skyrocketing over the long term. So, if you look at the discounted earnings model, of course, we're not going to take a crazy 45-50%.
If we apply a growth rate of 30% with a P/E ratio also of 30 and a share dilution of about 1%. If we click " calculate" for a 5- year period, we will see a fair value closer to 263. But if we look at a P/E ratio of, say, 35, and a growth rate of 35%, and click " calculate" now, the fair value will be closer to the current 370.
So, in my personal opinion, I believe that in the long term, the growth rate will stabilize somewhere between 30% and 35%. We are talking about a 5-year outlook with a P/E ratio that also remains at the current level of around 30-35%. So, the fair value , in my personal opinion, again, I'll do a more detailed analysis and update the fair value after the earnings report in the first week of September, but in my opinion, the intrinsic value of Broadcom is somewhere between 270 and 370, right?
So, we are talking about levels around 300-325, which is a good opportunity for dollar cost averaging of investments. I know that's a pretty wide range. I know it's $100. It's really only 20%, plus or minus for Broadcom, but as I said, 350 could be a starting point, a very small starting position, and closer to 324 and below $300, I think, would be a fantastic price for Broadcom in the long term as I continue to build this position.
So, I hope you enjoyed this video and the full review of this company. Again , the links will be at the bottom if you are interested in joining with a 40% discount on the annual subscription. If you have any questions, please email [email protected], I will be happy to help. As always, happy investing, and see you in the next video.
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