Broadcom vs. Nvidia: 1 Critical Metric Shows Which Artificial Intelligence (AI) Chipmaker Is the Better Buy After Earnings

Broadcom (AVGO) and Nvidia (NVDA) are two of the leading chipmakers, with Nvidia dominating the AI accelerator market. Both companies have recently reported strong quarterly updates, with Broadcom's AI semiconductor division growing by 221% year-over-year to $16.7 billion and Nvidia's data center revenue growing by 117% to $89 billion.

While Nvidia is currently trading at a lower valuation compared to Broadcom, the latter's growth potential in custom AI chips may make it a more attractive investment. The author suggests that a 30x forward earnings valuation would be appropriate for both stocks, with Broadcom showing over 50% upside potential.