Broadcom is attractively valued but has a weak balance sheet; OpenAI's AS6 tape-out is a bullish catalyst.

Now, this jalapeno chip is made in partnership with Broadcom. Now, Broadcom is a really interesting play because they are pretty heavily indebted. Their balance sheet kind of sucks, but their valuation is dirt freaking cheap right now. Uh they are trading for under a one peg.

Broadcom according to our stock AI has a uh $95 price target. The issue is we have a red flag on the balance sheet for the company because they are so heavily um you know indebted.

So, your your balance sheet is a red flag. valuation is just a clean green flag. They're down like 26% from their peak after their last earnings because of the timing of delivery of AS6.

So, why what does this have to do with OpenAI? Well, they're doing the AS6 for OpenAI. That's they're also doing the Google TPUs. So, OpenAI now like, hey, we're getting ready to tape these out probably bullish Broadcom. It's kind of bullish the whole stack.

But these ASIC producers, so think Marll and think Broadcom. Uh Broadcom has better margins than Marll, but uh Marll has a better balance sheet than Broadcom. Marll is also a $200 11 billion company.

It's up about 5.6%. I've got exposure to Marll. I don't have exposure to Broadcom, but I really like Broad. Like I'm really tempted by it right now. $1.7 trillion company.

So what does that mean? Well, what that means is you might end up seeing companies preferring A6 from Broadcom, Google TPUs, which are expecting to scale next year, uh, or Marll A6, uh, or Nvidia 5090s or 6000s over the bleeding edge Vera Rubin chips.