Got $250? 1 Top Growth Stock to Buy That Could Double Your Money.

A tried-and-tested way of making money in the stock market is by buying and holding on to solid companies over the long run. Doing so helps investors take advantage of disruptive trends that lead to companies delivering above-average returns.

Right now, Broadcom (NASDAQ: AVGO) is capitalizing on a major disruptive trend in the form of artificial intelligence (AI). Assuming you have $250 in investible cash that isn't needed to pay down high-interest loans, pay off your bills, or save enough for difficult times, you can consider buying one share of Broadcom with that money, and potentially double your investment.

Let's look at the reasons why this tech stock could double in value over the long run.

Image source: Getty Images.

Broadcom has a couple of solid growth drivers

AI has opened up a tremendous growth opportunity for Broadcom, giving the company access to an addressable market that it estimates could be $60 billion to $90 billion annually over the next couple of fiscal years. Broadcom is calculating this potential revenue opportunity based on the three unnamed cloud hyperscalers that are currently using its custom AI processors and networking chips.

That opportunity could be much larger in the future when taking into account that it is "deeply engaged with two other hyperscalers in enabling them to create their own customized AI accelerator," according to CEO Hock Tan. Broadcom is in the final stage of designing chips for these two additional unnamed customers, and they should start contributing toward the chipmaker's growth from next year.

Throw in the fact that Broadcom was selected to develop custom AI chips by another two cloud hyperscalers recently, and it's easy to see why there has been a nice upward revision in the company's revenue estimates.

Data by YCharts.

Importantly, AI is not the only major catalyst that could give Broadcom a big boost in the future. The company's infrastructure software business is also growing at a nice clip, recording 25% year-over-year growth in the second quarter of fiscal 2025 (which ended on May 4). Broadcom offers customers a private cloud platform on which they can build and scale applications while keeping operating costs in check.

The size of the private cloud server market is expected to grow from almost $114 billion in 2023 to more than $508 billion by the end of the decade, according to Grand View Research. So, there is a good chance that Broadcom's infrastructure software business will be able to sustain its healthy growth levels for a long time to come.

Impressive earnings growth could help the stock double

Broadcom's presence in multibillion-dollar end markets explains why the company's revenue expectations jumped for the next couple of fiscal years. The healthy top-line growth is expected to filter down to the company's bottom line as well, with analysts forecasting earnings to increase at healthy double-digit percentage rates going forward. This year's estimated jump is 36%.

Data by YCharts.

Don't be surprised to see Broadcom deliver stronger earnings growth in the future, thanks to the catalysts discussed. Assuming the company can clock an annual earnings growth rate of 20% in the two years after fiscal 2027, its bottom line could hit $13.88 per share after five years. If we multiply that by Broadcom's five-year average forward earnings multiple of 38, which is lower than the U.S. technology sector's average earnings multiple of 48, its stock price could jump to $527 in five years.

That would be more than double Broadcom's current stock price, which is why investors looking to buy a growth stock with $250 should consider buying it before it flies higher.

Should you invest $1,000 in Broadcom right now?

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Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy.