Broadcom (NASDAQ:AVGO) Trading Down 5.1% – Time to Sell?

Shares of Broadcom Inc. (NASDAQ:AVGO) dropped 5.1% during mid-day trading on Wednesday . The stock traded as low as $371.17 and last traded at $372.10. Approximately 37,454,200 shares were traded during mid-day trading, an increase of 45% from the average daily volume of 25,888,504 shares. The stock had previously closed at $392.16.

More Broadcom News

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

Analysts Set New Price Targets

AVGO has been the topic of several recent analyst reports. UBS Group set a $485.00 target price on shares of Broadcom and gave the company a “buy” rating in a report on Thursday, June 4th. TD Cowen reiterated a “buy” rating and set a $500.00 price objective on shares of Broadcom in a report on Thursday, June 4th. Evercore reiterated an “outperform” rating and set a $582.00 price objective on shares of Broadcom in a report on Tuesday, May 19th. Wall Street Zen upgraded shares of Broadcom from a “hold” rating to a “buy” rating in a report on Sunday, June 7th. Finally, Oppenheimer reiterated an “outperform” rating and set a $535.00 price objective (up from $450.00) on shares of Broadcom in a report on Thursday, June 4th. One equities research analyst has rated the stock with a Strong Buy rating, twenty-nine have given a Buy rating and three have given a Hold rating to the company’s stock. According to MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and an average price target of $490.13.

Broadcom Stock Down 0.9%

The firm’s fifty day moving average price is $402.89 and its two-hundred day moving average price is $363.19. The stock has a market cap of $1.82 trillion, a price-to-earnings ratio of 63.68, a price-to-earnings-growth ratio of 0.65 and a beta of 1.41. The company has a debt-to-equity ratio of 0.71, a current ratio of 2.24 and a quick ratio of 2.01.

Broadcom (NASDAQ:AVGO) last announced its quarterly earnings data on Wednesday, June 3rd. The semiconductor manufacturer reported $2.44 earnings per share for the quarter, beating the consensus estimate of $2.40 by $0.04. Broadcom had a net margin of 38.85% and a return on equity of 41.61%. The firm had revenue of $22.19 billion for the quarter, compared to analyst estimates of $22.13 billion. During the same quarter in the prior year, the business earned $1.58 earnings per share. The business’s quarterly revenue was up 47.9% compared to the same quarter last year. Sell-side analysts forecast that Broadcom Inc. will post 10.24 earnings per share for the current fiscal year.

Broadcom Announces Dividend

The firm also recently announced 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 is Monday, June 22nd. Broadcom’s dividend payout ratio is currently 43.33%.

Insider Buying and Selling

In related news, insider S. Ram Velaga sold 8,000 shares of the company’s stock in a transaction dated Friday, April 10th. The shares were sold at an average price of $370.52, for a total value of $2,964,160.00. Following the sale, the insider owned 57,932 shares in the company, valued at $21,464,964.64. This represents a 12.13% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, Director Gayla J. Delly sold 1,000 shares of the company’s stock in a transaction dated Thursday, April 9th. The stock was sold at an average price of $358.31, for a total transaction of $358,310.00. Following the completion of the sale, the director owned 32,352 shares in the company, valued at $11,592,045.12. This represents a 3.00% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 324,282 shares of company stock worth $106,425,249 over the last ninety days. Insiders own 1.90% of the company’s stock.

Institutional Investors Weigh In On Broadcom

A number of institutional investors and hedge funds have recently made changes to their positions in AVGO. ROSS JOHNSON & Associates LLC raised its holdings in shares of Broadcom by 1,320.0% in the 4th quarter. ROSS JOHNSON & Associates LLC now owns 71 shares of the semiconductor manufacturer’s stock worth $25,000 after acquiring an additional 66 shares during the last quarter. Networth Advisors LLC increased its stake in Broadcom by 546.2% in the 1st quarter. Networth Advisors LLC now owns 84 shares of the semiconductor manufacturer’s stock valued at $26,000 after buying an additional 71 shares during the last quarter. SWAN Capital LLC increased its stake in Broadcom by 261.9% in the 4th quarter. SWAN Capital LLC now owns 76 shares of the semiconductor manufacturer’s stock valued at $26,000 after buying an additional 55 shares during the last quarter. Miller Global Investments LLC purchased a new stake in Broadcom in the 4th quarter valued at about $31,000. Finally, Nvest Wealth Strategies Inc. purchased a new stake in Broadcom in the 4th quarter valued at about $33,000. 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 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.