Broadcom (NASDAQ:AVGO) Stock Price Down 2.1% – Time to Sell?
by Doug Wharley · The Cerbat GemBroadcom Inc. (NASDAQ:AVGO – Get Free Report) shares were down 2.1% during mid-day trading on Tuesday . The company traded as low as $408.41 and last traded at $419.30. Approximately 18,581,552 shares were traded during trading, a decline of 25% from the average daily volume of 24,924,361 shares. The stock had previously closed at $428.43.
Trending Headlines about Broadcom
Here are the key news stories impacting Broadcom this week:
- Positive Sentiment: Wells Fargo and other analysts turned more bullish on Broadcom’s AI chip and data-center networking business, saying Wall Street may be underestimating demand from hyperscaler buildouts. Article Title
- Positive Sentiment: Broadcom is being framed as one of the main winners of the AI capital-spending cycle, with multiple articles highlighting accelerating custom AI silicon revenue and expectations for continued earnings growth into the next report. Article Title
- Positive Sentiment: Investor sentiment was also helped by major institutions and high-profile investors continuing to add to Broadcom positions, reinforcing the view that the AI thesis remains intact. Article Title
- Neutral Sentiment: Broadcom’s valuation remains elevated after its sharp run, so the stock may be sensitive to any sign that AI growth slows or expectations become too optimistic.
- Negative Sentiment: The company is also facing an EU antitrust lawsuit over VMware-related document requests, which adds a legal overhang even though it is not the main driver of today’s move. Article Title
Wall Street Analysts Forecast Growth
Several equities research analysts have recently issued reports on AVGO shares. Wells Fargo & Company reiterated an “overweight” rating and set a $545.00 price target (up from $430.00) on shares of Broadcom in a report on Thursday. JPMorgan Chase & Co. upped their price target on shares of Broadcom from $475.00 to $500.00 and gave the company an “overweight” rating in a report on Thursday, March 5th. Weiss Ratings downgraded shares of Broadcom from a “buy (b-)” rating to a “hold (c+)” rating in a report on Friday, April 24th. Rosenblatt Securities reissued a “buy” rating and set a $500.00 price objective on shares of Broadcom in a report on Tuesday, April 7th. Finally, Citigroup reiterated a “buy” rating and set a $500.00 price target (up from $475.00) on shares of Broadcom in a research note on Tuesday. Two equities research analysts have rated the stock with a Strong Buy rating, twenty-seven have issued a Buy rating and four have issued a Hold rating to the company. According to MarketBeat, the company currently has a consensus rating of “Moderate Buy” and an average target price of $439.97.
Broadcom Stock Up 5.5%
The firm has a market capitalization of $2.08 trillion, a price-to-earnings ratio of 85.90, a P/E/G ratio of 0.86 and a beta of 1.43. The company has a current ratio of 1.90, a quick ratio of 1.73 and a debt-to-equity ratio of 0.80. The firm has a fifty day moving average price of $363.46 and a 200 day moving average price of $354.12.
Broadcom (NASDAQ:AVGO – Get Free Report) last issued its quarterly earnings results on Wednesday, March 4th. The semiconductor manufacturer reported $2.05 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.03 by $0.02. Broadcom had a net margin of 36.57% and a return on equity of 38.61%. The business had revenue of $19.31 billion for the quarter, compared to the consensus estimate of $19.10 billion. During the same quarter in the prior year, the company earned $1.60 EPS. The firm’s quarterly revenue was up 29.5% on a year-over-year basis. Sell-side analysts anticipate that Broadcom Inc. will post 9.95 EPS for the current fiscal year.
Broadcom Announces Dividend
The company also recently declared a quarterly dividend, which was paid on Tuesday, March 31st. Investors of record on Monday, March 23rd were given a $0.65 dividend. This represents a $2.60 dividend on an annualized basis and a dividend yield of 0.6%. The ex-dividend date was Monday, March 23rd. Broadcom’s dividend payout ratio (DPR) is currently 50.78%.
Insider Activity
In other Broadcom news, CFO Kirsten M. Spears sold 36,292 shares of the stock in a transaction on Tuesday, March 17th. The shares were sold at an average price of $321.60, for a total value of $11,671,507.20. Following the sale, the chief financial officer directly owned 327,760 shares in the company, valued at approximately $105,407,616. This trade represents a 9.97% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through the SEC website. Also, insider S. Ram Velaga sold 38,841 shares of Broadcom stock in a transaction on Tuesday, March 17th. The stock was sold at an average price of $321.60, for a total transaction of $12,491,265.60. Following the transaction, the insider directly owned 96,147 shares in the company, valued at approximately $30,920,875.20. This represents a 28.77% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold 324,282 shares of company stock worth $106,425,249 over the last quarter. 1.90% of the stock is owned by insiders.
Institutional Trading of Broadcom
Several hedge funds have recently added to or reduced their stakes in the business. Brighton Jones LLC increased its stake in Broadcom by 21.8% during the 4th quarter. Brighton Jones LLC now owns 29,683 shares of the semiconductor manufacturer’s stock worth $6,882,000 after purchasing an additional 5,322 shares in the last quarter. Revolve Wealth Partners LLC lifted its stake in Broadcom by 10.4% in the fourth quarter. Revolve Wealth Partners LLC now owns 7,997 shares of the semiconductor manufacturer’s stock valued at $1,854,000 after buying an additional 756 shares in the last quarter. United Bank boosted its holdings in shares of Broadcom by 76.5% in the first quarter. United Bank now owns 2,339 shares of the semiconductor manufacturer’s stock valued at $392,000 after buying an additional 1,014 shares during the period. Sivia Capital Partners LLC increased its position in shares of Broadcom by 10.1% during the second quarter. Sivia Capital Partners LLC now owns 12,693 shares of the semiconductor manufacturer’s stock worth $3,499,000 after acquiring an additional 1,160 shares in the last quarter. Finally, Capital & Planning LLC increased its position in shares of Broadcom by 10.5% during the second quarter. Capital & Planning LLC now owns 3,983 shares of the semiconductor manufacturer’s stock worth $1,098,000 after acquiring an additional 378 shares in the last quarter. Institutional investors and hedge funds own 76.43% of the company’s stock.
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.