Summary

• Broadcom is my top 'picks and shovels' play on AI infrastructure, underpinned by robust Q1 FY’26 results and a Strong Buy rating.
• AVGO delivered 29% YoY revenue growth, 34% GAAP net income growth, and 41% free cash flow margin, driven by hyperscaler AI demand and custom silicon leadership.
• Despite a 47x P/E and significant re-rating, AVGO’s lowest PEG among mega-caps signals strong profit growth expectations relative to peers.
• Key risks include customer concentration, cyclical hyperscaler capex, intensifying competition, and potential VMware customer backlash from its new subscription model.

We’ve all read the term “picks and shovels” thrown around the market, and believe me, I’ve used it a couple of times myself. But in my opinion, the biggest company that deserves this title is

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