Beyond Tesla: Best Bets for the Next Trillion Dollar Companies

Broadcom (AVGO)

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Companies closer to the trillion dollar mark have a greater chance of reaching those levels in the future. Broadcom (NASDAQ:AVGO) currently has a market cap above $350 billion and has enjoyed significant appreciation because of the AI boom.

The semiconductor giant already had attractive top and bottom line growth before artificial intelligence became mainstream. However, this extra tailwind and other parts of the business model can help the company exceed $1 trillion in a few years.

If Broadcom’s valuation surpasses $1 trillion, it will join Nvidia, another semiconductor giant that benefits from the AI tailwind. Semiconductor chips are vital for artificial intelligence tools and many other products.

These chips find themselves in computers, cars, smartphones, washing machines, refrigerators, microwaves, air conditioners, and gaming consoles.

The recent surge brought Broadcom’s P/E ratio above 26, which isn’t a nosebleed valuation because of the company’s solid business model. Comfortable double-digit revenue and earnings growth before the AI boom has helped the company earn a 19 forward P/E ratio.

Investors who can wait 5-10 years may see Broadcom reach the trillion dollar milestone. Valuation expansion because of the AI boom can get it to the milestone sooner.

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