Broadcom (NASDAQ:AVGO) Stock Price Up 1.6% – Here’s Why

Broadcom Inc. (NASDAQ:AVGO)’s stock price traded up 1.6% during mid-day trading on Tuesday. The company traded as high as $361.86 and last traded at $355.10. Approximately 18,774,598 shares were traded during mid-day trading, a decline of 25% from the average session volume of 25,176,006 shares. The stock had previously closed at $349.57.

Trending Headlines about Broadcom

Here are the key news stories impacting Broadcom this week:

• Positive Sentiment: Major Anthropic relationship: Broadcom reportedly agreed to lend Anthropic up to $42 billion so the AI company can lease Broadcom chips. Anthropic is expected to become Broadcom’s largest customer next year, potentially creating substantial, recurring demand for custom AI accelerators and related infrastructure. Broadcom to lend Anthropic up to $42 billion to lease its chips
• Positive Sentiment: AI growth thesis remains intact: Investor commentary argues that Broadcom’s expanding AI-chip business continues to support additional share purchases, with an AI-sector collapse identified as the key scenario that could invalidate the thesis. Historical data cited by another report also shows AVGO gained in each of the past 13 fourth quarters, offering a favorable—but not fundamental—seasonal backdrop. The Only Way I Stop Adding Broadcom is an AI Collapse History Says Broadcom Stock’s Best Season Starts Now
• Neutral Sentiment: Strong recent operating performance: Broadcom’s latest reported quarter exceeded consensus estimates for both earnings and revenue, while revenue increased sharply year over year. Analysts continue to expect substantial full-year earnings, although the stock’s elevated valuation leaves less room for execution disappointments.
• Negative Sentiment: Customer and financing risk: Anthropic’s reported $161.2 billion of Broadcom lease obligations and $518 billion of total infrastructure commitments raise questions about whether the AI company can generate enough funding and cash flow to meet those obligations. Broadcom’s anticipated dependence on Anthropic as its largest customer could magnify the impact of any slowdown, delay, or AI spending collapse. Broadcom’s AI Growth Story Faces a $161 Billion Anthropic Test

Wall Street Analyst Weigh In

AVGO has been the topic of a number of research analyst reports. Rosenblatt Securities started coverage on Broadcom in a report on Thursday, September 3rd. They issued a “buy” rating and a $600.00 target price on the stock. Oppenheimer reissued an “outperform” rating and set a $535.00 price target (up from $450.00) on shares of Broadcom in a report on Thursday, June 4th. Citic Securities upgraded Broadcom to a “buy” rating and upped their price objective for the stock from $450.00 to $525.00 in a research report on Tuesday, September 8th. Sanford C. Bernstein reaffirmed a “buy” rating on shares of Broadcom in a research note on Monday, September 21st. Finally, Raymond James Financial reiterated an “outperform” rating and issued a $475.00 target price (up from $450.00) on shares of Broadcom in a research report on Thursday, September 3rd. One investment analyst has rated the stock with a Strong Buy rating, thirty-seven have assigned a Buy rating and three have issued a Hold rating to the company’s stock. According to MarketBeat.com, the company presently has an average rating of “Moderate Buy” and an average price target of $527.20.

Broadcom Stock Down 0.1%

The firm’s fifty day moving average price is $374.25 and its 200-day moving average price is $380.70. The company has a market capitalization of $1.67 trillion, a price-to-earnings ratio of 44.97 and a beta of 1.44. The company has a debt-to-equity ratio of 0.57, a current ratio of 2.50 and a quick ratio of 2.29.

Broadcom (NASDAQ:AVGO) last released its quarterly earnings data on Wednesday, September 2nd. The semiconductor manufacturer reported $3.32 earnings per share for the quarter, beating the consensus estimate of $3.22 by $0.10. The company had revenue of $29.59 billion for the quarter, compared to the consensus estimate of $29.24 billion. Broadcom had a return on equity of 48.33% and a net margin of 42.94%.Broadcom’s revenue for the quarter was up 85.5% on a year-over-year basis. During the same quarter last year, the business posted $1.69 EPS. Sell-side analysts expect that Broadcom Inc. will post 10.36 earnings per share for the current fiscal year.

Broadcom Announces Dividend

The company also recently disclosed a quarterly dividend, which was paid on Wednesday, September 30th. Stockholders of record on Monday, September 21st were paid a $0.65 dividend. The ex-dividend date of this dividend was Monday, September 21st. This represents a $2.60 annualized dividend and a dividend yield of 0.7%. Broadcom’s dividend payout ratio is currently 33.21%.

Insider Buying and Selling

In related news, insider Mark Brazeal sold 25,000 shares of the firm’s stock in a transaction that occurred on Friday, July 10th. The shares were sold at an average price of $401.33, for a total value of $10,033,250.00. Following the completion of the transaction, the insider owned 194,989 shares in the company, valued at $78,254,935.37. This trade represents a 11.36% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, Director Gayla Delly sold 1,890 shares of Broadcom stock in a transaction that occurred on Wednesday, July 8th. The stock was sold at an average price of $385.38, for a total transaction of $728,368.20. Following the sale, the director owned 31,326 shares in the company, valued at approximately $12,072,413.88. This represents a 5.69% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. In the last quarter, insiders sold 51,890 shares of company stock valued at $20,241,368. 1.90% of the stock is owned by company insiders.

Hedge Funds Weigh In On Broadcom

A number of hedge funds have recently modified their holdings of the business. State Street Corp grew its position in shares of Broadcom by 8.7% in the 2nd quarter. State Street Corp now owns 208,031,610 shares of the semiconductor manufacturer’s stock valued at $75,367,711,000 after buying an additional 16,651,378 shares during the last quarter. Norges Bank bought a new position in shares of Broadcom during the fourth quarter worth about $24,252,196,000. Bank of America Corp DE lifted its stake in shares of Broadcom by 4.6% in the second quarter. Bank of America Corp DE now owns 61,423,013 shares of the semiconductor manufacturer’s stock worth $23,202,543,000 after acquiring an additional 2,685,916 shares during the period. Wellington Management Group LLP boosted its holdings in Broadcom by 3.8% in the second quarter. Wellington Management Group LLP now owns 51,580,703 shares of the semiconductor manufacturer’s stock valued at $19,484,611,000 after acquiring an additional 1,892,721 shares during the last quarter. Finally, UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC boosted its holdings in Broadcom by 2.9% in the second quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 40,180,530 shares of the semiconductor manufacturer’s stock valued at $15,178,195,000 after acquiring an additional 1,140,598 shares during the last quarter. Institutional investors and hedge funds own 76.43% of the company’s stock.

Broadcom Company Profile

Broadcom Inc (NASDAQ: AVGO) is a global technology company that designs, develops, and supplies semiconductor and infrastructure software products. Its semiconductor solutions support wired and wireless communications, data center networking, broadband access, storage, industrial applications, and other markets.

The company’s semiconductor portfolio includes networking and switching products, custom application-specific integrated circuits, wireless connectivity components, radio-frequency devices, optical components, and storage-related solutions.