We recently published a list of 10 Best Predictive Analytics Stocks to Invest in Now. In this article, we are going to take a look at where Broadcom Inc. (NASDAQ:AVGO) stands against other predictive analytics stocks to invest in now.
Data is at the forefront of many inventions today and is the primary ingredient of innovation. Of the many branches of data usage, predictive analytics is garnering immense traction, especially with the advent of artificial intelligence. Predictive analytics is the use of data, statistics, modeling, and machine learning to forecast, predict, and plan future events. There are different types of predictive analytics including regression analysis, time-series analysis, and machine learning algorithms.
According to a report by Fortune Business Insights, the global predictive analytics market was valued at $14.71 billion in 2023. The global predictive analytics market is expected to grow to $95.3 billion by 2032 from $18.02 billion in 2024 at a compound annual growth rate (CAGR) of 23.1%. The report attributes the growth in the industry to the growing investments in data by the government and large corporations followed by IoT and AI integrations. The use of predictive analytics is bifurcated into multiple segments including life sciences, automotive, retail, energy, telecom, and healthcare, to name a few.
Startups Disrupting the Predictive Analytics Space
There are a range of startups in the predictive analytics space that are revolutionizing the industry. One such name is Pecan AI. The automated predictive analytics platform is developed and designed intricately to meet the needs of data scientists. Data scientists can use the platform to build powerful predictive AI capabilities and machine learning models that drive business impact. Data scientists do not need coding or data science skills to make use of the platform. The platform is used by a range of companies including Johnson & Johnson, SciPlay, Hydrant, Kenvue, Proper Cloth, and DME Acquire. Earlier in January, the company introduced predictive generative AI to transform enterprises. Pecan AI also has partnerships with some of the largest tech corporations and platforms including Azure and AWS.
DataRobot is another leader in the predictive analytics industry that delivers revolutionary AI use cases for businesses. Its AI platform consists of core AI features such as generative AI, predictive AI, AI governance, AI observability, and AI foundation. The platform promises 83% faster deployment and secures nearly 1.4 billion predictions every day. Users can run models in minutes by skipping manual data preparation and cleaning. Additionally, the platform eliminates the need for repetitive coding, by streamlining feature discovery and defining elements of datasets automatically. Users can connect data from warehouses such as AWS and Azure into a singular workspace. Some of the predictive use cases facilitated by DataRobot include time series modeling, clustering and seasonality, cold start forecasting, nowcasting, and anomaly detection.
Now that we have studied the predictive analytics industry and some revolutionary startups, let’s take a look at the 10 best predictive analytics stocks to invest in now.
Our Methodology
To come up with the 10 best predictive analytics stocks to invest in now we went through multiple reports on the internet, ETFs, and stock screeners. We then examined the analyst upside of each stock and ranked the ones with the highest percentage. Our list is in ascending order of the analyst upside as of November 11, 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Is Broadcom Inc. (AVGO) the Best Predictive Analytics Stock to Invest in Now?
A data analyst working at a computer, crunching numbers for the company's 80% total assets.
Broadcom Inc. (NASDAQ:AVGO) designs and develops a range of semiconductor products and is well known for making application-specific integrated circuits (ASICs). It also provides infrastructure software products. Some of its products include cable modems, networking processors, and storage adapters. The company serves the data center, networking, software, broadband, storage, and wireless markets.
Broadcom Inc. (NASDAQ:AVGO) offers predictive analytics through its Automation Analytics and Intelligence platform. The platform offers workload automation solutions supported by a predictive analytics workload platform allowing entities to visualize data and manage complex workloads that facilitate the development of crucial business insights.
Some key features of the platform by Broadcom Inc. (NASDAQ:AVGO) include cross-platform visibility, dynamic service level management, enhanced workload analytics, business monitoring, enhanced change control, and dynamic critical path discovery. All these features combined put AVGO ahead of its competitors.
Overall, Broadcom Inc. (NASDAQ:AVGO) is a rapidly growing company with expertise in ASICs, infrastructure software, and data analytics, contributing to its ranking on our list. Analysts are also bullish on the stock and their median price target of $200 implies an upside of 12%, as of November 11.
Baron Opportunity Fund stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its Q3 2024 investor letter:
“We continued to build our position in Broadcom Inc. (NASDAQ:AVGO), a global technology leader that designs, develops, and supplies a broad range of semiconductor and infrastructure software solutions. As AI continues to proliferate, we believe hyperscalers – such as Meta, Microsoft Azure, Google Cloud Compute, and Amazon Web Services, to name just a few – will increasingly deploy custom accelerator chips for their AI workloads as they can be more cost-effective and energy-efficient than using NVIDIA’s general-purpose GPUs. Broadcom has a leading position partnering with hyperscalers to develop these custom chips, with its AI customer accelerator business up 3.5-times year-over-year in its most recently reported quarter, and a goal of at least $8 billion in custom accelerator revenues for this fiscal year. Additionally, VMware continues to perform better than expected as Broadcom is implementing its product simplification and subscription revenue model strategy. Further, its non-AI related semiconductor business, which tends to be more cyclical, is in the early stages of a recovery. Combined, all these factors will drive strong revenue and earnings growth over the next several years.”
Overall, AVGO ranks 8th on our list of best predictive analytics stocks to invest in now. While we acknowledge the potential of AVGO to grow, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AVGO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
