Broadcom (NASDAQ:AVGO) Stock Falls 1.9% – Should You Sell?

Broadcom Inc. (NASDAQ:AVGO)’s stock price traded down 1.9% on Thursday. The company traded as low as $338.80 and last traded at $345.00. 16,665,480 shares were traded during mid-day trading, a decline of 33% from the average session volume of 24,806,801 shares. The stock had previously closed at $351.81.

More Broadcom News

Here are the key news stories impacting Broadcom this week:

• Positive Sentiment: Analyst support improved. DA Davidson upgraded Broadcom to “Buy,” while Rosenblatt Securities reaffirmed its Buy rating and assigned a $600 price target. Analysts cited Broadcom’s custom AI accelerator opportunity and long-term growth potential. DA Davidson Upgrades Broadcom to Buy
• Positive Sentiment: The Anthropic transaction reinforces demand for Broadcom’s AI hardware. A proposed $63 billion financing vehicle would purchase Broadcom AI racks and lease them to Anthropic, providing a significant potential sales channel. Separately, Meta’s planned AI capital raise could benefit Broadcom if it becomes a cornerstone investor and supplier. Broadcom Anthropic Deal
• Positive Sentiment: Growth expectations remain ambitious. Investor commentary highlights Broadcom’s projected AI semiconductor revenue of approximately $115 billion in fiscal 2027 and $230 billion in fiscal 2028. Articles also argue that expanding data-center spending, custom chips and networking demand could support the stock through 2030. Three AI Stocks to Buy and Hold Through 2030
• Neutral Sentiment: The main debate is valuation versus growth. Some analysts view the pullback as an attractive entry point and believe Broadcom remains inexpensive relative to its long-term potential. However, consensus targets above the recent trading range depend on continued exceptional AI growth and successful execution.
• Negative Sentiment: The Anthropic financing structure creates additional risk. Broadcom could face as much as $43 billion in backstop exposure if the asset-financing arrangement fails, although Fitch maintained an A- rating with a positive outlook, citing strong cash generation and manageable leverage. Broadcom Anthropic Financing Risks
• Negative Sentiment: Investors remain concerned about concentration and macroeconomic pressure. Broadcom’s AI growth depends heavily on a small group of customers, while supply constraints, margin pressure, rising interest rates and fears of excessive AI infrastructure spending could compress its valuation.

Analyst Upgrades and Downgrades

Several analysts have recently issued reports on AVGO shares. William Blair cut shares of Broadcom from an “outperform” rating to a “market perform” rating in a research note on Tuesday. JPMorgan Chase & Co. restated a “buy” rating on shares of Broadcom in a research report on Thursday, September 3rd. Bank of America lowered their price objective on shares of Broadcom from $530.00 to $460.00 and set a “buy” rating on the stock in a research note on Thursday, September 3rd. Raymond James Financial reissued 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. Finally, Piper Sandler assumed coverage on shares of Broadcom in a report on Wednesday, September 9th. They set an “overweight” rating and a $460.00 price target on the stock. One investment analyst has rated the stock with a Strong Buy rating, thirty-nine have assigned a Buy rating and five have issued a Hold rating to the company. According to data from MarketBeat, the stock has a consensus rating of “Moderate Buy” and a consensus target price of $530.52.

Broadcom Stock Performance

The company has a quick ratio of 2.29, a current ratio of 2.50 and a debt-to-equity ratio of 0.57. The stock’s fifty day moving average is $353.92 and its 200-day moving average is $367.09. The stock has a market cap of $1.65 trillion, a price-to-earnings ratio of 44.06 and a beta of 1.46.

Broadcom (NASDAQ:AVGO) last issued its earnings results on Wednesday, September 2nd. The semiconductor manufacturer reported $3.32 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $3.22 by $0.10. Broadcom had a net margin of 42.94% and a return on equity of 48.33%. The company had revenue of $29.59 billion for the quarter, compared to analysts’ expectations of $29.24 billion. During the same period in the prior year, the firm earned $1.69 EPS. Broadcom’s quarterly revenue was up 85.5% compared to the same quarter last year. On average, analysts forecast that Broadcom Inc. will post 10.37 EPS for the current year.

Broadcom Announces Dividend

The business also recently disclosed a quarterly dividend, which was paid on Wednesday, September 30th. Investors of record on Monday, September 21st were paid a dividend of $0.65 per share. This represents a $2.60 dividend on an annualized basis and a dividend yield of 0.8%. The ex-dividend date was Monday, September 21st. Broadcom’s payout ratio is presently 33.21%.

Hedge Funds Weigh In On Broadcom

Several large investors have recently modified their holdings of the stock. Networth Advisors LLC increased its position in Broadcom by 546.2% during the first quarter. Networth Advisors LLC now owns 84 shares of the semiconductor manufacturer’s stock worth $26,000 after purchasing an additional 71 shares during the last quarter. Core Capital Management & Research inc. purchased a new stake in shares of Broadcom during the 2nd quarter worth $31,000. DecisionPoint Financial LLC lifted its holdings in shares of Broadcom by 101.9% in the third quarter. DecisionPoint Financial LLC now owns 105 shares of the semiconductor manufacturer’s stock valued at $36,000 after purchasing an additional 53 shares in the last quarter. Harborfront Financial Group LLC acquired a new position in Broadcom in the 2nd quarter valued at $38,000. Finally, Align Financial LLC grew its holdings in Broadcom by 67.2% in the third quarter. Align Financial LLC now owns 112 shares of the semiconductor manufacturer’s stock valued at $38,000 after purchasing an additional 45 shares during the period. Hedge funds and other institutional investors 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 data center, networking, broadband, wireless communications, storage, industrial and other electronic applications.

The company’s semiconductor portfolio includes networking and switching components, custom accelerators, connectivity and wireless devices, broadband equipment, optical products, storage controllers and related infrastructure technologies.