An $803 billion company most people have never heard of just knocked Tesla out of the Magnificent 7

Without anyone noticing, a tech titan you’ve probably never heard of has knocked Tesla out of the Magnificent Seven. Can it stay there?

The overlooked Magnificent Seventh is Broadcom, a technology company that makes both hardware and software. It is well known in the infotech world, but unknown beyond it. The Magnificent Seven, designed as a group of stocks in early 2023, are the most valuable US technology companies by market capitalization. In descending order, they include Apple (recent market cap: $3.4 trillion), Microsoft, Nvidia, Alphabet, Amazon, Meta, and Tesla (recent market cap: $768 billion). However, Broadcom’s market cap surpassed Tesla’s last spring and has remained ahead of the electric vehicle maker for most of the year. Its market cap is currently around $803 billion.

Broadcom isn’t guaranteed to stay ahead of Tesla, at least in the short term. Tesla stock is notoriously volatile, and its market cap could plausibly surpass Broadcom’s for a while. But Broadcom’s long-term outlook is by far the sunnier of the two. Wall Street analysts, on average, expect its stock price to continue to rise, while they expect Tesla to continue to fall. Tesla shares have retreated to where they were nearly four years ago, while Broadcom’s are up 290% since then.

So how did this quiet giant sneak into the highest reaches of tech royalty? Mostly through a combination of tech savvy and financial acumen. The company is a nephew of Hewlett-Packard, which in 1999 spun off a company called Agilent Technologies, which in turn spun off a company called Avago into a pair of private equity firms in 2005. Avago began buying companies of semiconductors, in 2015 buying a big one called Broadcom and taking the name.

Broadcom’s PE ancestors have guided it since that spin-off. “Broadcom operates almost like a PE firm, where it invests in assets that can provide quick returns,” says Naveen Chhabra, an analyst at research and consulting firm Forrester. It is “wise to invest in companies where it can maintain or grow revenue” and at the same time “can turn the company into a high-margin business.”

View this interactive chart on Fortune.com

Exhibit A is Broadcom’s biggest acquisition, cloud computing firm VMware, which it bought last November. A Forrester report for VMware customers warns, “Don’t let the price increase shock you… In most cases, customers will find renewal quotes many times higher than what they paid in the past.”

Wall Street Approves Broadcom’s Changes. “It looks like they’re killing VMware,” says Bernstein analyst Stacy Rasgon, “which beat expectations by a lot in the quarter and looks poised to keep growing.”

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Shrewd acquisitions and management are central to Broadcom’s growth, but they don’t fully explain the company’s phenomenally growing market cap. The other crucial factor is, unsurprisingly, the AI ​​frenzy. One of Broadcom’s most important businesses is designing semiconductors — computer chips — and over the past year, demand has skyrocketed. Broadcom’s AI chip sales in fiscal 2023 were $4.2 billion, BofA Securities reports. The firm expects AI chip sales to reach $12.1 billion this year and $16.9 billion next year.

Broadcom’s chip expertise, along with VMware’s success, propelled Broadcom’s market cap above McDonald’s when OpenAI launched ChatGPT in November 2022 at Magnificent Seven levels today.

Critical to Broadcom’s success and future is CEO Hock Tan, who was recruited to lead the company when Avago was spun off in 2005. Now 72, he was born in Malaysia and earned degrees in engineering from MIT plus an MBA from Harvard. Business school. He spent most of his career in technology companies, although he also held finance positions at PepsiCo and General Motors – hence the company’s joint expertise in technology and finance. In recent years, Tan has been among the highest paid CEOs in the US; earned $162 million last year. Succession is an obvious issue for the company, but no successor is obvious. Tan said he would continue to run the company for at least another four years.

Wall Street analysts are mostly cheering for Broadcom. “It looks like the numbers will continue to grow,” says Bernstein’s Rasgon. “And the valuation looks increasingly attractive.” JP Morgan’s Harlan Sur says the stock “remains our top pick in semiconductors.”

No tree grows to the sky, but for now the sun shines brightly on this company. Beyond that, the only certainty is that Broadcom can no longer be anonymous.

This story was originally featured on Fortune.com