The AI Boom Is Creating a New Set of Winners. These Stocks Stand Out
Quick Read
Dell booked $130B in AI server orders with a record $95B backlog, and Hock Tan confirmed Broadcom secured supply to double AI revenue to $115B.
Dell has gained 688% over five years, Credo is up over 1,100% since 2022, and Broadcom has returned 2,375% over the past decade.
Building a portfolio and living off one are two completely different skills, and almost nobody teaches the second. This problem is what The Definitive Guide to Retirement Income helps, and it is free today. Read more here. (Sponsor)
Hyperscalers are spending heavily across every layer of the stack. That includes the server racks, the cables that link them and the custom chips inside (we featured seven suppliers riding that same expansion, from power to cooling to networking, in a free AI infrastructure report).
Thinkstock
Three companies stand out as 2027 approaches. Each just reported huge growth, and a sharp drop in recent weeks has made their valuations look more reasonable. Here’s how each one could reach a round-number price target.
Dell Technologies Has a $95 Billion Backlog Behind a $500 Target
Dell Technologies (NYSE:DELL) is up 213.43% year-to-date, even after falling 30.51% over the past month. Jeff Clarke said on the earnings call, “Over the past 12 months, we have booked more than $130 billion in AI server orders.” Dell ended the quarter with a record $95B AI backlog. Non-GAAP EPS came in at $7.04, beating the $4.90 estimate. That makes four beats in a row.
Analysts now expect $28.2013 in fiscal 2028 EPS. Ninety days ago, they expected $19.4275. At $390.38, Dell trades at 14x that estimate. A move to $500 would be a 28% gain and lift the multiple to just 18x. That’s still below the S&P 500’s about 22x.
DELL Price Target — 24/7 Wall St.
Credo Needs a 40% Gain to Reach $200
Credo (NASDAQ:CRDO) is down 0.6% year-to-date, but the business keeps speeding up. Revenue rose 114.7% to $479M, and EPS of $1.20 extended Credo’s beat streak to 8 consecutive quarters.
——
Now Available: The Definitive Guide to Retirement Income
Many successful investors eventually reach the same moment. The saving is done, the portfolio is built, and the question quietly changes from how much can I grow this to how much can I take out? Get that second question wrong and decades of good investing can come apart in a handful of years.
That is exactly what The Definitive Guide to Retirement Income helps answer. It covers what your retirement could actually cost, which income sources are worth using, and the withdrawal math that decides whether the money lasts. It is free today from Fisher Investments. Read More Here ›
——
CEO Bill Brennan said, “What’s different today is that we’re adding optics as another major growth engine.” Credo expects more than $600 million in optical revenue in fiscal 2027.
Analysts project fiscal 2028 EPS of $9.7121, which is 54% above this year’s $6.3093. At $143.03, Credo trades at 15x that estimate. At $200, the multiple would be 21x.
CRDO Price Target — 24/7 Wall St.
Broadcom Expects to Double AI Revenue, Which Points to $400
Broadcom (NASDAQ:AVGO) is down 3.64% in 2026, even as AI chip revenue rose 221% to $16.70B. CEO Hock Tan said, “In 2027, we have secured the supply to again double AI revenue to approximately $115 billion. Our demand actually exceeds this outlook.” Broadcom has now beaten estimates for 9 consecutive quarters.
Analysts expect fiscal 2027 EPS of $19.4651, up 67% from this year’s estimate. At $331.68, Broadcom trades at 17x. At $400, a 21% gain, it would trade at 21x.
AVGO Price Target — 24/7 Wall St.
Catalysts That Could Unlock All Three Targets
Rising estimates: Dell’s fiscal 2027 EPS estimate had 23 upward revisions and zero cuts over the past 30 days.
Product cycles: Credo expects its first 1.6T DSP revenue later in fiscal 2027. Broadcom taped out Tomahawk 7, the first 200-terabit-per-second Ethernet switch.
New AI labs as customers: Broadcom expects Anthropic to become its largest XPU customer in 2027. OpenAI’s Jalapeno chip is on track for a 1.3 gigawatt deployment.
Past Returns Show These Targets Are Within Reach
Dell has gained 688.29% over five years. Credo is up 1127.73% since early 2022, and Broadcom has returned 2375.7% over the past decade. Compared with those runs, the required gains are small.
Challenges remain. Dell called its supply bottleneck “DRAM, DRAM, DRAM.” Credo’s largest customer made up 33% of revenue. Broadcom’s fiscal 2027 estimate had 26 downward revisions over the past 30 days.
Bottom Line on $500, $200 and $400
All three companies have long beat streaks, earnings growing quickly and forward multiples near or below the market’s. These targets look achievable with steady AI spending and looser supply chains.
Expecting this level of returns every year is unrealistic, but this is how Dell, Credo and Broadcom could post outsized gains in 2027.
Released: The Definitive Guide to Retirement Income
(Sponsor) Most people spend their entire working lives focusing on one thing: growing a pile of money. Then they retire and discover the skill they actually need is close to the opposite. Turning that pile into steady income, year after year, through good markets and bad, without ever running out.
It may be the least discussed and most consequential transition in personal finance, and plenty of otherwise careful investors walk into it with no real plan. That is exactly what The Definitive Guide to Retirement Income helps answer. It is a free guide from Fisher Investments covering what your retirement will really cost, where the cash flow should come from, and how much you can safely withdraw each year. Learn more here. Learn More Here ›
Is a market crash coming? That’s the question on many investors’ minds today as the strong bull market continues. The S&P 500 (SNPINDEX: ^GSPC) has more than doubled over the past four years, and it’s up 12% year to date. Artificial intelligence (AI) euphoria is still driving the market, but there are signs that suggest
The S&P 500 (^GSPC +0.31%) fell 4.4% on Thursday, its worst day since April 2025, while the Nasdaq slumped 5.5%. That deep sell-off pushed the Nasdaq into correction territory, with it tumbling more than 10% below its recent record. Nobody knows whether that’s the start of something bigger. But it landed in a market already
Quick Read Berkshire Hathaway (BRK-B) sits on $377 billion in cash and ramped up Q3 buybacks to $10 billion, signaling management sees value in the stock. Berkshire has gained 14% this year while the S&P 500 rose 8%, as its railroad, insurance and energy mix sidestepped the AI rally. Markel, often called a mini-Berkshire, runs
Last month, Wall Street and investors celebrated the fourth anniversary of the current bull market. Both the benchmark S&P 500 (^GSPC +0.31%) and growth-fueled Nasdaq Composite (^IXIC +1.09%) have more than doubled from their 2022 bear market lows, while the iconic Dow Jones Industrial Average (^DJI -0.46%) has rallied as much as 90%. A confluence
Seoul Mayor Oh Se-hoon. News1 “Focus on pumping up prices before the election… nine circuit breakers in five months” On Saturday, Oh criticized the government’s stock market policy through his social media accounts. “Last Friday the Kospi broke below the 5,000 line and a circuit breaker was triggered,” he wrote. “Of the 11 circuit breakers
Fundamental Backdrop and Market Sentiment I wrote on 1st November that the best trades for the week would be: Short of the EUR/USD currency pair below $1.1300. This pair fell over the week by 0.17%. A summary of last week’s most important data in the market: US Average Hourly Earnings – increased at a slightly
An agreement to acquire optical components provider Lumentum Holdings (LITE +5.67%) in an all-stock transaction valued at $115 billion sent Marvell Technology down 28.1% this week. Marvell Technology stock changed hands at $141.20 as of the close on Friday, Nov. 6, having dropped 32% from Friday, Oct. 30’s close, according to data provided by S&P
Companies that generate positive operating cash flow can allocate their capital in various ways. Of course, reinvesting in the business is what many long-term investors appreciate, as it can boost intrinsic value over time. There are also mergers and acquisitions, as well as paying down debt. When it comes to returning capital to investors, companies
Wall Street’s tumultuous midterm election week kicked off with a celebration among investors. On Wednesday, stocks soared after Democrats swept both chambers of Congress. The Dow (^DJI) surged more than 1,500 points. The S&P 500 (^GSPC) rallied nearly 2%. And in less than 24 hours, stocks reversed course, plunging Thursday as Wall Street and Main
Shares of Micron Technology and Sandisk have soared 280% and 457%, respectively, over the past year as demand for memory processors in data centers jumped. Spending for artificial intelligence (AI) infrastructure isn’t slowing down right now — as Alphabet‘s (GOOGL +0.78%) (GOOG +0.78%) recent quarterly results show — and that’s great news for Micron and Sandisk
The stock market dived last week. Investors priced in political backlash against data centers after Democrats swept Congress. We anticipated buying opportunities after the midterm elections, and Thursday’s selloff delivered some. This remains an earnings-led bull market. Valuations are falling while earnings are soaring. We still view the AI backlash as another speed bump, not
It’s a rally. It’s a sell-off. At the end of the week, the only thing that was clear was confusion. Investors were hoping to get clarity with the U.S. midterm elections behind them. Instead, they got more volatility. The reason is uncertainty about future regulation surrounding data centers. The conventional wisdom suggests it may not
Political gridlock, strong earnings, and a historical pattern that hasn’t failed in 21 midterm election cycles Listen to the audio version of this article (generated by AI). Editor’s Note: The midterm elections are behind us, and Washington is gearing up for another round of political battles. But I still feel optimistic – and so does
Rolls-Royce’s (BMW.DE) well-heeled clients aren’t pumping the brakes on new commissions, despite a choppy stock market and lingering economic worries, according to the automaker’s top executive in North America. “Honestly, no,” Nick Keen, president of Rolls-Royce Motor Cars North America, told Yahoo Finance at the Wynn Concours in Las Vegas when asked if clients are
It’s been said that bull markets end when good news fails to boost prices, and that bear markets end when bad news fails to send prices lower. On that note, Bitcoin (BTC +0.28%) is 33.7% above its bear market lows in late June. Most of the high-flying artificial intelligence (AI) value-chain stocks, on the other
The S&P 500 (^GSPC +0.31%) is up 10.8% this year, but it’s been falling over the past few weeks. If it falls any lower, it will break its streak of double-digit annual gains over the past four years. Between soaring artificial intelligence (AI) spend, high inflation, steady interest rates, and the results of Tuesday’s U.S.
Wall Street partied the day after the midterms and woke up Thursday to tech’s worst day since the 2020 COVID crash. Strip out the AI trade, though, and most stocks barely noticed. The equal-weight S&P 500 (RSP), a stand-in for the typical stock, closed at a record Wednesday and ended the week within about 1%
There’s nothing like a good selloff to turn a trader into an investor – so the saying goes. It’s an adage that echoes the sentiment of an even older one: buy when there’s blood in the streets. The maxims ring true after Thursday’s selloff in stocks that sent the Cboe Volatility Index (VIX) to its
Many investors don’t believe the terms “Magnificent Seven” and “bargain stocks” usually belong in the same sentence. And it’s easy to see why. Over the past five years, the Magnificent Seven has gained more than 180% as a group, more than double the S&P 500’s total return over the same period. But I wouldn’t be
