Wells Fargo Upgrades Broadcom to Bullish on 2026 Growth Catalysts

Wells Fargo has upgraded Broadcom Inc. (AVGO) to a bullish rating, citing a strengthening pipeline of growth catalysts projected for 2026. The firm now anticipates that AVGO’s strategic positioning in AI infrastructure, enterprise software, and networking hardware will drive accelerated revenue expansion beyond current expectations. Key drivers include increased demand for high-performance chips used in data centers and the potential for transformative acquisitions in the semiconductor ecosystem. The upgrade follows a reassessment of AVGO’s capital allocation strategy and long-term revenue visibility. Analysts project AVGO’s annual revenue to reach $48 billion by 2026, up from $39 billion in 2024, representing a compound annual growth rate of 6.5% over the forecast period. Additionally, operating margins are expected to stabilize near 58%, supported by cost synergies from recent integrations and continued pricing power in niche semiconductor markets. Market participants are responding to the note with increased buying interest, as AVGO's stock has risen 3.2% in pre-market trading. The move affects not only growth investors but also institutional allocations in the technology and semiconductors sectors. ETFs with significant AVGO exposure, including the Vanguard Information Technology ETF (VGT) and the iShares Semiconductor ETF (SOXX), have seen inflows over the past 48 hours. The development underscores growing confidence in AVGO’s ability to sustain leadership in high-margin technology segments amid macroeconomic uncertainty. With a market cap exceeding $2.1 trillion, the stock remains a cornerstone holding in major tech portfolios.