PREVIEW: Broadcom rises, investors eye AI chip margins

Broadcom AVGO.O shares rising 2.1% on Wed ahead of qtrly results after the bell, with investors focused on AI chip demand and its impact on margins

The chip designer is expected to report a 29% surge in fiscal first-qtr rev to $19.18 bln and adj EPS of $2.03, vs $1.60 yr-ago, per LSEG

In Dec, the co projected strong AI rev but warned that a higher mix of AI biz would pressure gross margins, sending shares lower post-earnings

Stock recently at 27 times expected earnings, above its five-year avg of 22, per LSEG data

Shares have fallen ~7.5% YTD, underperforming the Nasdaq's .IXIC 1.6% dip

Wall Street is bullish, with 49 of 51 analysts rating the stock 'buy' or 'strong buy'; median PT is $454 vs current price of $320.49