Broadcom Stock: AVGO Climbs 4% as $63B AI Deal Raises Stakes

TLDR

• Broadcom stock gained more than 4% on Tuesday following an analyst upgrade and new AI financing.
• DA Davidson raised its AVGO price target from $350 to $400 and upgraded the stock to Buy.
• Anthropic disclosed $161.2 billion in equipment lease payments under its Broadcom agreements.
• Four major financial firms announced $63 billion in financing for Broadcom AI chips and networking equipment.
• Anthropic’s planned IPO and expected 2027 hardware deliveries remain central to Broadcom’s growth outlook.

Broadcom (AVGO) stock climbed more than 4% on Tuesday after DA Davidson upgraded the chipmaker and four financial firms announced $63 billion in funding for equipment used by Anthropic. The announcements followed Anthropic’s public filing for a planned US stock market listing.

Broadcom Inc., AVGO

Broadcom Stock Gains After Analyst Upgrade

DA Davidson analyst Gil Luria raised Broadcom’s rating to Buy from Neutral and increased his price target to $400 from $350. The new target stood about 22% above Monday’s closing price.

Luria cited Broadcom’s valuation at about 16 times estimated 2027 earnings. He expects Anthropic’s offering to provide capital for further AI expansion. He also expects OpenAI to seek public funding next year. The upgrade follows recent pressure on Broadcom stock despite the company’s projected growth in AI chip sales.

Anthropic Filing Details Equipment Leases

Anthropic filed its S-1 registration statement with the Securities and Exchange Commission on October 26. The Claude developer plans to list on Nasdaq under the ticker ANT, although it has not announced an offering price or date.

The filing lists five-year equipment leases with Broadcom carrying approximately $161.2 billion in rent payments, excluding interest. Anthropic pays quarterly, generally after equipment becomes ready for use at third-party data centers. Some computing capacity entered service in 2026, with more scheduled for 2027.

Banks Arrange $63 Billion Financing

Bank of America, Blackstone, Citigroup and Morgan Stanley announced funding for Broadcom processors and networking products destined for Anthropic. The agreement comes as other AI hardware purchases draw substantial funding, including recent financing for Nvidia graphics processors.

A newly created company will purchase and lease the hardware. Bank of America, Citi and Morgan Stanley will arrange approximately $43.5 billion in senior loans. Blackstone will provide a lower-priority portion. Broadcom will help protect lenders against possible future losses in equipment value.

AI Investment Plans Face Further Tests

Other technology companies are also seeking funds for computing expansion. Meta recently outlined plans to raise up to $95 billion for AI development, through an initial share offering and a possible later program. Broadcom, Nvidia and AMD have expressed interest in purchasing some shares.

Broadcom expects deliveries under its Anthropic computing agreement to begin in 2027. The company’s sales outlook depends partly on customer spending, production schedules and access to financing.

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