--- title: "Broadcom and CoreWeave: One AI Stock Is the Right Play, but Avoid the Other, Says Investor" type: "News" locale: "en" url: "https://longbridge.com/en/news/300054500.md" description: "Investor The Value Portfolio rates Broadcom (AVGO) a Strong Buy, citing strong AI revenue growth, custom chip opportunities, and diversified business. Conversely, it rates CoreWeave (CRWV) a Strong Sell due to high capital expenditures, expensive financing costs, and reliance on Nvidia GPUs amidst a shift toward custom silicon." datetime: "2026-09-24T15:46:09.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/300054500.md) - [en](https://longbridge.com/en/news/300054500.md) - [zh-HK](https://longbridge.com/zh-HK/news/300054500.md) generator: "portal-rs" --- # Broadcom and CoreWeave: One AI Stock Is the Right Play, but Avoid the Other, Says Investor **Broadcom (NASDAQ:AVGO)** and **CoreWeave (NASDAQ:CRWV)** are both heavily involved in the AI game, but they sit in different parts of the industry. Broadcom is one of the biggest beneficiaries of the next phase of the AI buildout, as hyperscalers look beyond Nvidia GPUs and pour billions into custom chips. CoreWeave, meanwhile, is focused on building data centers packed with the GPUs AI companies need to train and run their models. But while both are benefiting from the AI infrastructure boom, an investor using the moniker The Value Portfolio (TVP) sees very different investment cases, with only one of these names poised to make the most of the opportunity. Looking at Broadcom, the chip giant’s latest results show just how quickly the business is growing. The company generated $29.6 billion in revenue in its latest quarter, up 86% year over year, while free cash flow reached almost $14 billion. Management expects revenue to rise to $34.8 billion in the next quarter, including almost $22 billion from AI. For the 5-star investor, the bigger story is what comes next. Hyperscalers are spending enormous amounts on AI infrastructure, but many are also looking for alternatives to Nvidia’s GPUs. Custom accelerators can give companies more control over costs and performance, and Broadcom is positioned to provide the technology behind many of these projects. Google is a good example. The company has developed its own AI chips, known as Tensor Processing Units (TPUs), as an alternative to Nvidia’s GPUs. Anthropic, Google and Broadcom have agreed to develop up to 5 GW of TPU capacity, while Meta and other major technology companies are also pursuing custom AI silicon. CEO Hock Tan has projected more than $100 billion in AI revenue for Broadcom in 2027, and TVP believes there is scope for the company to exceed that target as custom silicon takes a larger share of the market. Broadcom also has major businesses outside AI, including networking, along with a long record of acquisitions. For TVP, that gives the company additional sources of growth and cash generation beyond AI. Put it all together and Broadcom represents a “valuable long-term investment opportunity.” To this end, The Value Portfolio rates AVGO stock a Strong Buy. (To watch The Value Portfolio’s track record, click here) CoreWeave has also built an impressive AI infrastructure operation. The company has more than 1.5 GW of active power and around 4.2 GW of contracted capacity, while its revenue backlog has climbed above $100 billion. But turning that backlog into revenue requires enormous amounts of capital. CoreWeave spent $9.4 billion on capital expenditures in its latest quarter and expects to spend roughly $38 billion during 2026. The financial returns have yet to match that spending. CoreWeave generated $2.6 billion of revenue in the latest quarter, up 112% year over year, but adjusted operating income was only $128 million, giving the company an operating margin of roughly 5%. Financing adds another challenge. CoreWeave’s latest $2.6 billion loan facility carries a spread of 5.5 percentage points over SOFR, a key U.S. interest-rate benchmark, putting its borrowing cost above 9%. That compares with substantially cheaper financing available to companies such as Google. TVP also sees a longer-term challenge in CoreWeave’s reliance on Nvidia GPUs. As AI companies become more focused on the cost of running models, custom silicon could become more attractive. Anthropic has committed to Google’s TPU infrastructure through its partnership with Google and Broadcom, while Amazon is developing custom Trainium infrastructure for the company. CoreWeave’s contracted power remains a valuable asset, and stronger-than-expected AI demand could improve its economics. But TVP argues that the company faces heavy capital requirements, high financing costs and a potentially difficult shift toward custom silicon, while Broadcom is positioned to supply that shift. “Fundamentally,” TVP wrapped up, “the firm has no strong advantages versus its major competitors, which are dramatically larger and wealthier.” As such, The Value Portfolio gives CRWV stock a Strong Sell rating. Turning now to the Street’s view, Broadcom claims a Strong Buy consensus rating, while its $519.21 average price target offers one-year upside of 49%. CoreWeave is rated a Moderate Buy and is expected to gain 60%, given the average target clocks in at $139.38. 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CRWV Gets Wall Street-High $250 Price Target](https://longbridge.com/en/news/300948858.md) --- > **Disclaimer: This article is for reference only and does not constitute any investment advice.**