Broadcom (NASDAQ:AVGO) Trading 3.6% Higher – Still a Buy?

Broadcom Inc. (NASDAQ:AVGO) traded up 3.6% during mid-day trading on Thursday . The stock traded as high as $389.50 and last traded at $385.57. 33,778,862 shares were traded during mid-day trading, an increase of 30% from the average session volume of 25,964,875 shares. The stock had previously closed at $372.10.

Key Stories Impacting Broadcom

Here are the key news stories impacting Broadcom this week:

• Positive Sentiment: Broadcom’s quarterly results were very strong, with revenue up 48% to a record $22.2 billion, semiconductor revenue up 79%, AI semiconductor revenue up 143% to $10.8 billion, and more than $30 billion in AI bookings, suggesting demand remains robust. Article Title
• Positive Sentiment: Several analysts and commentators argue the recent drop could be a buying opportunity, saying Broadcom remains a core infrastructure winner in AI and that Wall Street’s long-term outlook is still constructive. Article Title
• Positive Sentiment: Fresh coverage highlighted Broadcom as one of the stocks with catalysts heading into the second half of the year, and some analysts have raised earnings forecasts and price targets despite the selloff. Article Title
• Neutral Sentiment: Jim Cramer said Broadcom’s earnings were “not good” and suggested tech stocks are harder to trust as leadership names, reflecting a more cautious market mood around the stock. Article Title
• Neutral Sentiment: Broadcom also announced cash tender offers for certain outstanding debt securities, a routine balance-sheet move that is unlikely to move the stock by itself. Article Title
• Negative Sentiment: Market commentary says the stock is being punished because investors are nitpicking Broadcom’s AI outlook and pricing the shares as if growth must keep accelerating without any hiccups. Article Title
• Negative Sentiment: One note warned that Broadcom told investors to expect gross profit margins to continue falling, reinforcing concerns that profitability may soften even as revenue grows. Article Title

Wall Street Analyst Weigh In

A number of research firms have issued reports on AVGO. Cantor Fitzgerald reaffirmed an “overweight” rating and set a $525.00 price objective on shares of Broadcom in a report on Thursday, June 4th. Benchmark lifted their price objective on shares of Broadcom from $485.00 to $545.00 and gave the stock a “buy” rating in a report on Thursday, June 4th. Evercore reaffirmed an “outperform” rating and set a $582.00 price objective on shares of Broadcom in a report on Tuesday, May 19th. JPMorgan Chase & Co. lifted their price objective on shares of Broadcom from $500.00 to $580.00 and gave the stock an “overweight” rating in a report on Thursday, June 4th. Finally, Seaport Research Partners reaffirmed a “neutral” rating on shares of Broadcom in a report on Wednesday, April 8th. One research analyst has rated the stock with a Strong Buy rating, twenty-nine have given a Buy rating and three have issued a Hold rating to the stock. According to MarketBeat.com, Broadcom has a consensus rating of “Moderate Buy” and an average target price of $490.13.

Broadcom Stock Down 0.9%

The company has a current ratio of 2.24, a quick ratio of 2.01 and a debt-to-equity ratio of 0.71. The stock has a market capitalization of $1.82 trillion, a PE ratio of 63.68, a P/E/G ratio of 0.68 and a beta of 1.41. The stock’s fifty day simple moving average is $404.26 and its 200-day simple moving average is $363.33.

Broadcom (NASDAQ:AVGO) last issued its quarterly earnings results on Wednesday, June 3rd. The semiconductor manufacturer reported $2.44 earnings per share for the quarter, topping analysts’ consensus estimates of $2.40 by $0.04. The company had revenue of $22.19 billion for the quarter, compared to the consensus estimate of $22.13 billion. Broadcom had a net margin of 38.85% and a return on equity of 41.61%. The firm’s quarterly revenue was up 47.9% on a year-over-year basis. During the same period in the previous year, the firm earned $1.58 EPS. As a group, sell-side analysts forecast that Broadcom Inc. will post 10.24 EPS for the current fiscal year.

Broadcom Announces Dividend

The business also recently declared a quarterly dividend, which will be paid on Tuesday, June 30th. Investors of record on Monday, June 22nd will be issued a $0.65 dividend. This represents a $2.60 dividend on an annualized basis and a dividend yield of 0.7%. The ex-dividend date of this dividend is Monday, June 22nd. Broadcom’s payout ratio is 43.33%.

Insider Activity at Broadcom

In related news, insider S. Ram Velaga sold 38,841 shares of the business’s stock in a transaction dated Tuesday, March 17th. The shares were sold at an average price of $321.60, for a total value of $12,491,265.60. Following the transaction, the insider directly owned 96,147 shares of the company’s stock, valued at approximately $30,920,875.20. The trade was a 28.77% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CFO Kirsten M. Spears sold 36,292 shares of the business’s stock in a transaction dated Tuesday, March 17th. The stock was sold at an average price of $321.60, for a total transaction of $11,671,507.20. Following the completion of the transaction, the chief financial officer directly owned 327,760 shares in the company, valued at $105,407,616. This trade represents a 9.97% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold a total of 324,282 shares of company stock valued at $106,425,249 over the last quarter. Corporate insiders own 1.90% of the company’s stock.

Hedge Funds Weigh In On Broadcom

Hedge funds and other institutional investors have recently made changes to their positions in the stock. Brown Brothers Harriman & Co. increased its position in shares of Broadcom by 10.7% in the third quarter. Brown Brothers Harriman & Co. now owns 77,411 shares of the semiconductor manufacturer’s stock worth $25,539,000 after purchasing an additional 7,499 shares during the last quarter. Dana Investment Advisors Inc. increased its position in shares of Broadcom by 2.6% in the third quarter. Dana Investment Advisors Inc. now owns 173,759 shares of the semiconductor manufacturer’s stock worth $57,325,000 after purchasing an additional 4,442 shares during the last quarter. Sovran Advisors LLC increased its position in shares of Broadcom by 121.3% in the fourth quarter. Sovran Advisors LLC now owns 30,631 shares of the semiconductor manufacturer’s stock worth $10,507,000 after purchasing an additional 16,789 shares during the last quarter. Thurston Springer Miller Herd & Titak Inc. increased its position in shares of Broadcom by 406.1% in the fourth quarter. Thurston Springer Miller Herd & Titak Inc. now owns 11,994 shares of the semiconductor manufacturer’s stock worth $4,151,000 after purchasing an additional 9,624 shares during the last quarter. Finally, Siligmueller & Norvid Wealth Advisors LLC bought a new position in shares of Broadcom in the third quarter worth approximately $762,000. 76.43% of the stock is owned by hedge funds and other institutional investors.

About Broadcom

Broadcom Inc (NASDAQ: AVGO) is a global technology company that designs, develops and supplies semiconductor and infrastructure software solutions for a broad range of markets. The company’s semiconductor business provides components and systems for wired and wireless communications, enterprise and cloud storage, networking and broadband access, serving original equipment manufacturers, cloud service providers, telecommunications carriers and industrial customers worldwide. Broadcom is headquartered in Irvine, California, and operates globally with research, development and sales organizations across North America, Europe and Asia.

On the semiconductor side, Broadcom’s portfolio includes system-on-chip (SoC) and application-specific integrated circuit (ASIC) solutions, radio-frequency and connectivity components, Ethernet switching and PHY devices, storage adapters and controllers, optical transceivers and other networking silicon.