On November 2, Marvell Technology agreed to buy Lumentum Holdings in an all-stock deal valuing Lumentum's enterprise value at $115 billion, based on October 28 closing prices, and says the combination will create a category leader in AI connectivity. Broadcom's stock dipped only about 1% that day while Marvell fell about 13%, and Broadcom now trades near $335, roughly 30% below its June 2 record close of $481.57. Broadcom already competes in most of those markets, and its AI semiconductor revenue reached $16.7 billion in fiscal Q3, up 221% year over year, versus Marvell's total quarterly revenue of $2.74 billion. Broadcom forecasts $115 billion in AI semiconductor revenue for fiscal 2027, double the nearly $58 billion expected for fiscal 2026, and the Marvell deal is expected to close in the first half of calendar 2028, so it won't directly affect that year. The author notes Broadcom trades at around 17 times consensus fiscal 2027 earnings estimates versus about 18.7 times forward earnings for the S&P 500, and says he would still consider adding to his position at this price.
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