Broadcom is the “most underappreciated AI beneficiary” after its deal with Apple, according to Bank of America. Analyst Vivek Arya hiked his price objective on the stock after Apple on Tuesday announced a multibillion-dollar deal with Broadcom for 5G radio frequency components made in the U.S., saying it removes an “overhang” on the stock. “We believe this is a positive development as it removes one key overhang on AVGO stock – namely the risk of Apple’s insourcing of connectivity components – surfaced in media reports earlier this year,” Arya wrote in a Tuesday note. “We reiterate Buy on AVGO on this improved certainty, and separately on its highly underappreciated/overlooked position as a leading provider of custom AI computing and switching silicon,” Arya added. Arya raised his target to $800 from $725, which implies nearly 18% upside from Monday’s closing price of $678.37. The analyst also reiterated a buy rating on the stock. Broadcom shares climbed 2% during Tuesday’s trading. They’re up about 24% this year. —CNBC’s Michael Bloom contributed to this report.
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