Broadcom (NASDAQ:AVGO) Stock Falls 5.5% – Here’s Why

Broadcom Inc. (NASDAQ:AVGO)’s share price traded down 5.5% during mid-day trading on Friday. The company traded as low as $319.30 and last traded at $326.08. Approximately 36,301,227 shares changed hands during trading, an increase of 46% from the average daily volume of 24,864,658 shares. The stock had previously closed at $345.00.

Broadcom News Roundup

Here are the key news stories impacting Broadcom this week:

• Positive Sentiment: DA Davidson upgraded Broadcom to Buy from Neutral and raised its price target from $350 to $400, citing the company’s exposure to major AI customers, including Anthropic. Broadcom Falls Despite DA Davidson Upgrade
• Positive Sentiment: A proposed $63 billion financing structure tied to Anthropic could provide Broadcom with a funded customer for its ambitious AI semiconductor plans. Broadcom has projected AI semiconductor revenue of approximately $115 billion in fiscal 2027 and $230 billion in fiscal 2028. However, the arrangement includes a potential Broadcom backstop of roughly $43 billion, creating execution and financial-risk considerations. Broadcom’s Anthropic Deal
• Neutral Sentiment: Commentary remains constructive on long-term demand for custom AI chips, networking equipment and data-center infrastructure. Meta’s planned capital raise of more than $100 billion to fund its AI buildout could also benefit suppliers such as Broadcom, although higher financing costs and the need to prove returns on capital spending remain concerns. Meta’s Financing Plan and Broadcom
• Negative Sentiment: Intel’s weaker-than-expected forecast prompted investors to reassess semiconductor demand, pressuring Intel, AMD and Broadcom. Amazon’s results also heightened worries that rapidly rising AI infrastructure spending may not generate attractive near-term returns. Why Intel, AMD and Broadcom Are Falling
• Negative Sentiment: Broadcom remains exposed to broader concerns about elevated AI valuations, rising interest rates and whether hyperscalers can sustain enormous capital expenditures. As a result, investors are prioritizing near-term demand visibility and execution over bullish long-term revenue forecasts.

Wall Street Analyst Weigh In

A number of research firms recently issued reports on AVGO. Cantor Fitzgerald lifted their price objective on Broadcom from $525.00 to $600.00 and gave the company an “overweight” rating in a research report on Thursday, September 3rd. DA Davidson raised shares of Broadcom from a “neutral” rating to a “buy” rating and upped their price objective for the company from $350.00 to $400.00 in a research report on Tuesday. Citic Securities raised Broadcom to a “buy” rating and upped their price target for the company from $450.00 to $525.00 in a report on Tuesday, September 8th. Morgan Stanley restated an “overweight” rating and set a $505.00 price objective (up from $502.00) on shares of Broadcom in a research report on Thursday, September 3rd. Finally, Jefferies Financial Group assumed coverage on Broadcom in a research note on Thursday, September 3rd. They issued a “buy” rating and a $550.00 target price for the company. One investment analyst has rated the stock with a Strong Buy rating, thirty-nine have assigned a Buy rating and five have assigned a Hold rating to the company. According to MarketBeat.com, the stock has an average rating of “Moderate Buy” and an average price target of $530.52.

Broadcom Price Performance

The stock has a market capitalization of $1.56 trillion, a price-to-earnings ratio of 41.65 and a beta of 1.46. 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 stock has a fifty day moving average of $353.57 and a two-hundred day moving average of $367.09.

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

Broadcom Dividend Announcement

The business also recently declared a quarterly dividend, which was paid on Wednesday, September 30th. Stockholders of record on Monday, September 21st were given a $0.65 dividend. This represents a $2.60 annualized dividend and a dividend yield of 0.8%. The ex-dividend date was Monday, September 21st. Broadcom’s dividend payout ratio (DPR) is currently 33.21%.

Institutional Investors Weigh In On Broadcom

A number of hedge funds and other institutional investors have recently made changes to their positions in the stock. Networth Advisors LLC increased its position in shares of Broadcom by 546.2% during the 1st 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. acquired a new stake in shares of Broadcom in the second quarter valued at approximately $31,000. Harborfront Financial Group LLC bought a new stake in Broadcom during the second quarter worth about $38,000. DecisionPoint Financial LLC increased its stake in 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 acquiring an additional 53 shares during the last quarter. Finally, Align Financial LLC raised its stake in Broadcom by 67.2% during the third quarter. Align Financial LLC now owns 112 shares of the semiconductor manufacturer’s stock worth $38,000 after acquiring an additional 45 shares in the last quarter. 76.43% of the stock is currently owned by institutional investors and hedge funds.

About Broadcom

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.