NVDA designs the powerful graphics processing units (GPUs) that are used to train and run advanced AI models. On the other hand, Broadcom plays a key role with networking chips and custom ASICs (Application-Specific Integrated Circuit) that make hyperscale data centers more efficient.<\/p>\n
Both stocks have surged in recent years as AI adoption accelerates. Over the past year, shares of NVIDIA and Broadcom have soared 31.7% and 39.6%, respectively.<\/p>\n
NVDA vs AVGO: One-Year Price Return Performance<\/p>\n
![\"Zacks](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2026\/02\/146330.jpg\"\/)
Image Source: Zacks Investment Research<\/p>\n
So, the question for investors now is which of the two offers more upside in the current market. Let\u2019s break it down by looking at their financial performance, challenges and growth outlook.<\/p>\n
The Case for NVIDIA Stock<\/p>\n
NVIDIA remains the backbone of the AI boom, with its GPUs powering everything from cloud data centers to self-driving vehicles. The company continues to dominate the AI infrastructure market, driven by explosive demand from cloud providers and enterprises. In the third quarter of fiscal 2026, NVIDIA\u2019s revenues surged 62% year over year to $57 billion, while non-GAAP earnings per share (EPS) jumped 60% to $1.30.<\/p>\n
The company\u2019s new GPU architectures, Hopper 300 and Blackwell, are rapidly gaining adoption as customers race to expand AI capabilities. The Blackwell Ultra and upcoming Vera Rubin platforms could further cement NVIDIA\u2019s leadership as the AI hardware race intensifies.<\/p>\n
NVIDIA\u2019s most powerful growth engine continues to be its Data Center business. In the third quarter of fiscal 2026, the segment generated $51.22 billion in revenues, representing 89.8% of total sales. This marked a staggering 66% year-over-year increase and 25% sequential growth.<\/p>\n
The robust performance was mainly driven by higher shipments of the Blackwell GPU computing platforms that are used for the training and inference of large language models, recommendation engines and generative AI applications.<\/p>\n
NVIDIA\u2019s partnership with OpenAI, which involves the construction of massive AI data centers powered by NVIDIA systems, is expected to boost long-term demand for its GPUs. The deal reinforces NVIDIA\u2019s position as the dominant supplier of AI chips worldwide.<\/p>\n
The Case for Broadcom Stock<\/p>\n
Broadcom has established itself as a critical player in the AI ecosystem. The company supplies networking chips and custom ASICs that allow hyperscale data centers to handle the enormous data traffic generated by AI workloads.<\/p>\n
Financially, the company is experiencing strong growth in the top and bottom lines. In the last reported financial results for the fourth quarter of fiscal 2025, Broadcom\u2019s revenues jumped 28.2% year over year to $18.02 billion, while non-GAAP earnings per share (EPS) soared 37.3% to $1.95.<\/p>\n
The company is benefiting from strong demand for its networking products and custom AI accelerators. Broadcom\u2019s AI revenues grew 65% year over year in fiscal 2025, reaching $20 billion. This growth is driven by AI semiconductors and infrastructure software, with AI revenues expected to double year over year to $8.2 billion in the first quarter of fiscal 2026.<\/p>\n
Broadcom\u2019s AI networking segment also experienced strong demand, with a $10 billion order backlog for AI switches, including the 102-terabit-per-second Tomahawk 6 switch. The company has secured record orders for DSPs, optical components and PCI Express switches, all of which contribute to its total AI-related order backlog of $73 billion in the fourth quarter of fiscal 2026.\u00a0 This backlog represents nearly half of Broadcom\u2019s consolidated backlog of $162 billion.<\/p>\n
Broadcom\u2019s innovative products are also playing a crucial role in its expansion. In November, the company announced the availability of the Brocade X8 Directors and Brocade G820 56-port switch, the industry\u2019s first 128G Fibre Channel platforms designed for mission-critical workloads and enterprise AI applications.<\/p>\n
NVDA vs. AVGO: Which Has the Stronger EPS Growth Outlook?<\/p>\n
Both companies will benefit from the surging demand for AI chips, but NVIDIA\u2019s EPS growth profile appears stronger in the near term. The Zacks Consensus Estimate for NVDA\u2019s current fiscal-year 2027 EPS indicates a year-over-year surge of 57.1%. On the other hand, estimates for Broadcom\u2019s current fiscal-year 2026 EPS imply 49.9% growth.<\/p>\n
The long-term (three to five years) expected EPS growth for NVIDIA is also way higher than that for Broadcom. Currently, the long-term expected EPS growth rate for NVDA is 46.31% compared with Broadcom\u2019s 35.66%.<\/p>\n
Valuation: NVDA Is Cheaper Than AVGO<\/p>\n
Comparing the two stocks\u2019 valuations, Broadcom currently trades at a lower forward 12-month price-to-earnings (P\/E) multiple of 28.66 compared to NVIDIA\u2019s 24.76. This suggests investors are paying a larger premium for AVGO stock, even though its forward earnings growth profile is lower than NVDA\u2019s.<\/p>\n
NVDA vs AVGO: 12-Month Forward P\/E Ratio<\/p>\n
![\"Zacks](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2026\/02\/146334.jpg\"\/)
Image Source: Zacks Investment Research<\/p>\n
Conclusion: NVDA Is the Better Buy Right Now<\/p>\n
Both companies are benefiting from the ongoing AI boom. Broadcom has stable demand, a huge backlog and strong networking exposure. NVIDIA has stronger earnings growth prospects, direct exposure to AI compute demand and a stronger product pipeline. NVDA\u2019s slightly cheaper valuation makes it a better investment option than Broadcom.<\/p>\n