PREVIEW: Broadcom shares edge up; results due after the bell

Shares of Broadcom AVGO.O were up 0.6% on Thurs, with the semiconductor manufacturing co seen reporting a rise in qtrly rev and EPS when it reports results after the closing bell

The co is expected to report an increase in Q2 revenue to $14.993 bln from $12.487 bln in the yr-ago qtr, and it is expected to post adj EPS of $1.56/shr vs $1.10 a yr ago, according to LSEG.

"Everyone is going to focus in on the AI side of their business," Daniel Morgan, vice president and senior portfolio manager at Synovus Trust Company, said in an interview Thurs

"Any indications they can give us of these new customers that are in the works that they could potentially be producing these custom AI ASIC chips for, that's what everybody is going to be focusing on," Morgan said

In March, Broadcom's CEO assuaged investor worries about AI chip demand with a strong second-quarter forecast and hinted about new potential customers. Reuters reported earlier that OpenAI is working with Broadcom to finalize its first custom chip design

The co has beaten analysts' earnings expectations in all of the past eight reporting periods

Analyst recommendations on AVGO include 38 "strong buy" or "buy" ratings and four "hold" ratings

The median 12-mo price target on Broadcom is $250​; the stock was last at $262.46

"The table is clearly set for a potentially large breakout. Shares broke above a key resistance area just under $250. It couldn’t break through last week, could earnings be the catalyst for getting it over the top," writes Jay Woods, chief global strategist at Freedom Capital Markets, in note Thurs.

Including the session move, AVGO is up about 13% YTD compared with a roughly 1% gain in the Nasdaq .IXIC in that period