AVGO Stock Upgrade: DA Davidson Sees 2027 EPS Value

Broadcom (NASDAQ:AVGO) gained support following a DA Davidson upgrade highlighting Anthropic's S-1 filings, disclosing $131 billion in cash and a $161 billion relationship scale that underpins custom silicon demand.

### Tape & Valuation Dislocation Analyst commentary points to a valuation mismatch across the artificial intelligence semiconductor complex. While select peers trade at 20 to 40 times 2027 estimated earnings, Broadcom, Nvidia, and Micron sit at 5 to 16 times projected 2027 figures. DA Davidson emphasized that Anthropic's roughly 50% gross margins on net revenue support its ongoing scaling, with the equity trading near a 16x multiple on 2027 earnings.

### Story Arc / How We Got Here This update follows earlier October 2026 market developments where Broadcom faced tight Taiwan Semiconductor Manufacturing Co. foundry capacity constraints while managing custom XPU demand, as detailed in previous coverage at /explore/broadcom-avgo-faces-tsmc-capacity-bottlenecks-in-ai-race. The current focus centers on whether customer financing and foundry allocation can alleviate prior bottlenecks and sustain gross margin expansion.

### Money Play - If AVGO maintains its current 16x multiple relative to 2027 estimates while custom chip deployment advances, watch $AVGO+WL for multiple expansion opportunities.

### Technical Analysis & Key Risk Watch

Traders tracking large-cap semiconductor momentum observe valuation spreads across high-end hardware suppliers. Downside risks remain tied to potential delays in customer capital raises or execution hurdles regarding foundry wafer access.