During the September 14 airing of Mad Money, Jim Cramer addressed the broader pullback across the technology sector and highlighted Broadcom Inc (NASDAQ: AVGO) as an attractive option for investors willing to look past near-term turbulence and focus on the long term.

"It's not a great time to be in San Francisco right now, with the entire AI complex selling off, seemingly because Anthropic and OpenAI... I don't know how to put it... are pulling back on expansion," Cramer said. "But honestly, I think there are some real bargains being created in this space. Take Broadcom, for instance. This company makes chips, networking gear, tech infrastructure, and software. Its stock is down over 10% in the past month. Early this month, Broadcom delivered a stellar earnings report and a very optimistic multi-year outlook. But some on the Street viewed its current-quarter guidance as merely in line with expectations. So the shares got hammered. I believe Broadcom still has significant growth ahead; it's at the very core of the AI ecosystem. I've held this stock in my charitable trust for years, and this company has never let us down. With the stock about $150 off its June high, the valuation here is simply too low to pass up."

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Here's a look at the financial drivers behind this custom chip leader.

Broadcom's latest quarterly report demonstrated strong expansion across both its semiconductor and infrastructure segments. The company posted total revenue of $29.6 billion for the fiscal third quarter, up 85.5% year-over-year. AI chip revenue surged 221% to $16.7 billion, representing roughly 56% of total revenue. Remaining performance obligations jumped to $179.2 billion, providing high visibility into future contracted revenue. Broadcom's key customers include hyperscale AI players like Alphabet and Meta Platforms. Management raised its full-year AI revenue guidance to $58 billion from a prior $56 billion, while projecting $115 billion for that segment in fiscal 2027 and $230 billion in fiscal 2028. These figures underscore the company's deep integration into the enterprise AI supply chain through custom AI accelerators and high-speed networking solutions.

Weighing valuation against market expectations.

Despite record operational results, the market reaction has been negative because the near-term guidance didn't deliver the same magnitude of upside surprise as in previous quarters. As of this writing, Broadcom's stock has dropped about 7% since its September 2 earnings release. That pullback has brought its forward price-to-earnings ratio down to a more reasonable 18.1 times. Investors must still contend with the inherent cyclicality of the chip industry, magnified by macroeconomic pressures and shifts in capital expenditure plans among major tech giants.

Institutional positioning and market sentiment metrics.

Institutional interest in Broadcom remains robust, with major asset managers continuing to hold significant positions. According to Insider Monkey data, 170 hedge funds held Broadcom shares this quarter, compared to 173 in the previous quarter. In the second quarter, Fisher Asset Management was the largest hedge fund holder with 15.1 million shares. Short interest stands at just 1.08% of float as of August 31, indicating limited bearish bets.

Cramer's thesis explains why long-term AI investors are willing to look past near-term guidance noise — Broadcom is an indispensable piece of the AI infrastructure puzzle. Investing in cyclical semiconductor companies amid fluctuating tech budgets demands patience, but at 18.1 times earnings, paired with strong secular tailwinds, this pullback may offer a compelling entry point for a proven industry leader like Broadcom.