Broadcom (NASDAQ:AVGO) Stock Falls 4.8% on Analyst Downgrade

Broadcom Inc. (NASDAQ:AVGO) shares fell 4.8% on Friday after Rothschild & Co Redburn downgraded the stock from a buy rating to a neutral rating. Rothschild & Co Redburn now has a $398.00 price target on the stock, down from their previous price target of $595.00. Broadcom traded as low as $337.67 and last traded at $347.01. 31,384,834 shares traded hands during trading, an increase of 25% from the average daily volume of 25,192,787 shares. The stock had previously closed at $364.36.

Several other equities analysts have also commented on the stock. HSBC decreased their target price on shares of Broadcom from $600.00 to $560.00 and set a “buy” rating on the stock in a report on Thursday, September 3rd. BMO Capital Markets upped their price target on shares of Broadcom from $455.00 to $575.00 and gave the stock an “outperform” rating in a report on Thursday, September 3rd. Fox Advisors upgraded shares of Broadcom to an “outperform” rating in a research report on Thursday, September 3rd. Citigroup lowered shares of Broadcom from a “buy” rating to a “neutral” rating in a research report on Tuesday, October 27th. Finally, Cantor Fitzgerald lifted their price objective on shares of Broadcom from $525.00 to $600.00 and gave the company an “overweight” rating in a research note on Thursday, September 3rd. One investment analyst has rated the stock with a Strong Buy rating, thirty-eight have issued a Buy rating and six have assigned a Hold rating to the stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of “Moderate Buy” and a consensus target price of $525.19.

Top Broadcom Stories

Investors following AVGO have been watching these stories:

• Positive Sentiment: Broadcom could benefit as cloud providers diversify AI-chip suppliers. The company designs custom AI chips for hyperscalers, while ongoing infrastructure spending supports demand for its products. NVIDIA’s Crisis Opens the Board
• Positive Sentiment: Despite its downgrade, Rothschild & Co Redburn’s new $398 price target remains above the stock’s recent level; other Wall Street analysts also see potential upside. Wall Street Still Sees $533
• Negative Sentiment: Rothschild & Co Redburn cut its rating on Broadcom from Buy to Neutral and lowered its target by 33%, from $595 to $398. It cited growing exposure to AI financing arrangements and concerns that major AI startups, including Anthropic and OpenAI, may take time to become self-funding—potentially putting the pace or reliability of their spending at risk. Broadcom Downgrade Flags AI Financing Risks

Institutional Investors Weigh In On Broadcom

Hedge funds and other institutional investors have recently made changes to their positions in the stock. Coign Capital Advisors LLC lifted its stake in Broadcom by 1.3% in the 3rd quarter. Coign Capital Advisors LLC now owns 2,221 shares of the semiconductor manufacturer’s stock valued at $780,000 after buying an additional 29 shares in the last quarter. New World Advisors LLC raised its stake in Broadcom by 11.3% during the third quarter. New World Advisors LLC now owns 4,779 shares of the semiconductor manufacturer’s stock worth $1,678,000 after purchasing an additional 485 shares during the period. Tiff Advisory Services LLC purchased a new position in shares of Broadcom in the 3rd quarter worth $9,658,000. State Board of Administration of Florida Retirement System grew its holdings in shares of Broadcom by 7.5% during the 3rd quarter. State Board of Administration of Florida Retirement System now owns 4,254,899 shares of the semiconductor manufacturer’s stock worth $1,494,278,000 after purchasing an additional 295,015 shares during the period. Finally, 49 Wealth Management LLC acquired a new stake in shares of Broadcom in the third quarter worth $4,174,000. 76.43% of the stock is owned by institutional investors.

Broadcom Trading Down 4.8%

The stock has a market capitalization of $1.66 trillion, a PE ratio of 44.32 and a beta of 1.49. The company has a current ratio of 2.50, a quick ratio of 2.29 and a debt-to-equity ratio of 0.57. The business’s 50-day moving average is $345.59 and its two-hundred day moving average is $366.48.

Broadcom (NASDAQ:AVGO) last released its quarterly earnings data on Wednesday, September 2nd. The semiconductor manufacturer reported $3.32 EPS for the quarter, beating the consensus estimate of $3.22 by $0.10. Broadcom had a return on equity of 48.33% and a net margin of 42.94%. The company had revenue of $29.59 billion for the quarter, compared to analyst estimates of $29.24 billion. During the same period last year, the company posted $1.69 earnings per share. The firm’s revenue was up 85.5% compared to the same quarter last year. On average, analysts predict that Broadcom Inc. will post 10.20 earnings per share for the current year.

Broadcom Dividend Announcement

The business also recently announced a quarterly dividend, which was paid on Wednesday, September 30th. Investors of record on Monday, September 21st were issued a dividend of $0.65 per share. This represents a $2.60 annualized dividend and a dividend yield of 0.7%. The ex-dividend date was Monday, September 21st. Broadcom’s dividend payout ratio (DPR) is presently 33.21%.

About Broadcom

Broadcom Inc. is a global technology company that designs and supplies semiconductor products and infrastructure software. Its semiconductor portfolio includes chips and components used in networking, broadband communications, wireless connectivity, data storage, and industrial applications. The company serves businesses across a range of industries, including communications, enterprise technology, and consumer electronics. Broadcom also provides infrastructure software, including products for virtualization, cloud computing, cybersecurity, and enterprise operations.