Bank of America named Broadcom its top compute stock. BofA forecasts cloud capital expenditures will surge over 38% in 2026.
The bank emphasizes Broadcom will primarily benefit from increased AI infrastructure spending. This spending comes particularly from hyperscalers requiring custom solutions.
The analysis cites Broadcom's $73 billion AI-related backlog. Broadcom also reported a 74% year-over-year increase in AI-driven revenue. These figures validate the company's business model.
Upcoming earnings and capital expenditure plans from hyperscalers will serve as critical catalysts for the market.