Broadcom (NASDAQ:AVGO) Downgraded by Wall Street Zen to "Buy"

Key Points

• Broadcom was downgraded by Wall Street Zen from “strong-buy” to “buy,” though the broader analyst view remains positive with a consensus “Moderate Buy” rating and a $490.13 price target.
• The stock fell 4.7% to open at $392.13, below its 50-day moving average of $412.17, even as it remains well above its 200-day moving average of $363.42.
• Recent results were strong: Broadcom reported $2.44 EPS and $22.19 billion in quarterly revenue, both slightly above expectations, with revenue up 47.9% year over year.

Broadcom (NASDAQ:AVGO - Get Free Report) was downgraded by stock analysts at Wall Street Zen from a "strong-buy" rating to a "buy" rating in a research note issued on Tuesday.

A number of other equities analysts have also recently commented on the company. Citigroup reiterated a "buy" rating on shares of Broadcom in a report on Thursday, June 4th. Wells Fargo & Company restated an "overweight" rating and set a $545.00 price target (up from $430.00) on shares of Broadcom in a report on Thursday, May 14th. Erste Group Bank upgraded Broadcom from a "hold" rating to a "buy" rating in a report on Friday, June 5th. Morgan Stanley set a $502.00 price target on Broadcom and gave the stock an "overweight" rating in a research report on Thursday, June 4th. Finally, DA Davidson lifted their price objective on shares of Broadcom from $375.00 to $400.00 and gave the stock a "neutral" rating in a research note on Thursday, June 4th. One analyst has rated the stock with a Strong Buy rating, twenty-nine have assigned a Buy rating and three have issued a Hold rating to the company's stock. Based on data from MarketBeat, Broadcom has a consensus rating of "Moderate Buy" and a consensus price target of $490.13.

Broadcom Stock Down 4.7%

Shares of NASDAQ AVGO opened at $392.13 on Tuesday. The firm's 50-day moving average price is $412.17 and its 200-day moving average price is $363.42. The company has a current ratio of 2.24, a quick ratio of 2.01 and a debt-to-equity ratio of 0.71. The stock has a market capitalization of $1.87 trillion, a price-to-earnings ratio of 65.36, a P/E/G ratio of 0.72 and a beta of 1.41. Broadcom has a 12-month low of $246.46 and a 12-month high of $495.00.

Broadcom (NASDAQ:AVGO - Get Free Report) last announced its quarterly earnings results on Wednesday, June 3rd. The semiconductor manufacturer reported $2.44 EPS for the quarter, beating analysts' consensus estimates 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 during the quarter, compared to the consensus estimate of $22.13 billion. During the same quarter last year, the firm earned $1.58 EPS. The firm's revenue for the quarter was up 47.9% compared to the same quarter last year. On average, equities research analysts anticipate that Broadcom will post 10.24 EPS for the current fiscal year.

Insider Transactions at Broadcom

In other Broadcom news, Director Harry L. You purchased 1,000 shares of Broadcom stock in a transaction dated Thursday, June 11th. The shares were purchased at an average cost of $373.57 per share, for a total transaction of $373,570.00. Following the completion of the acquisition, the director owned 38,466 shares in the company, valued at $14,369,743.62. This represents a 2.67% increase in their position. The acquisition was disclosed in a legal filing with the SEC, which is available at this hyperlink. Also, insider S. Ram Velaga sold 8,000 shares of the firm's stock in a transaction that occurred on Friday, April 10th. The stock was sold at an average price of $370.52, for a total value of $2,964,160.00. Following the sale, the insider directly owned 57,932 shares of the company's stock, valued at $21,464,964.64. This represents a 12.13% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last 90 days, insiders sold 59,385 shares of company stock valued at $21,301,057. Company insiders own 1.90% of the company's stock.

Institutional Trading of Broadcom

A number of large investors have recently made changes to their positions in the stock. Norges Bank bought a new position in Broadcom in the fourth quarter worth approximately $24,252,196,000. Cardano Risk Management B.V. boosted its position in Broadcom by 895.2% during the 4th quarter. Cardano Risk Management B.V. now owns 12,689,800 shares of the semiconductor manufacturer's stock valued at $4,391,940,000 after acquiring an additional 11,414,701 shares in the last quarter. Arrowstreet Capital Limited Partnership boosted its position in Broadcom by 118.1% during the 1st quarter. Arrowstreet Capital Limited Partnership now owns 18,739,006 shares of the semiconductor manufacturer's stock valued at $5,799,889,000 after acquiring an additional 10,145,377 shares in the last quarter. State Street Corp increased its holdings in shares of Broadcom by 2.7% in the 4th quarter. State Street Corp now owns 190,084,351 shares of the semiconductor manufacturer's stock valued at $65,788,194,000 after acquiring an additional 5,040,801 shares during the period. Finally, Vanguard Group Inc. increased its holdings in shares of Broadcom by 0.8% in the 4th quarter. Vanguard Group Inc. now owns 482,707,302 shares of the semiconductor manufacturer's stock valued at $167,064,997,000 after acquiring an additional 3,919,715 shares during the period. 76.43% of the stock is owned by hedge funds and other institutional investors.

Key Broadcom News

Here are the key news stories impacting Broadcom this week:

• Positive Sentiment: Analysts and market commentators are pointing to Broadcom’s strong AI demand as the main reason to stay bullish. Recent coverage highlighted record semiconductor sales, AI chip and networking demand, and strong customer commitments as evidence that the company’s AI growth story remains intact. Broadcom's AI Push Boosts Semiconductor Sales: More Upside Ahead?
• Positive Sentiment: JPMorgan reportedly reiterated buy-the-dip optimism, citing Broadcom’s multi-year Google partnership, record quarterly revenue of $22.19 billion, and AI semiconductor sales of $10.8 billion, up 143% year over year. The note also pointed to expectations for another step-up in AI-chip growth next quarter. Broadcom's AI boom — Google deal and huge revenue growth spark buy-the-dip calls
• Positive Sentiment: Several pieces argue that the market is overreacting to a modest AI revenue guide and that the selloff has created an accumulation opportunity. They emphasize that Broadcom’s revenue, semiconductor growth, AI bookings, and backlog are all at record levels, which supports the longer-term investment case. The Grandest Castle Ever Floated (and the Stocks to Profit From It)
• Positive Sentiment: Broadcom is also attracting broader investor attention and continued analyst support, including a consensus “Moderate Buy” rating, which may help stabilize sentiment after the recent decline. Broadcom Inc. NASDAQ: AVGO Receives Consensus Recommendation of "Moderate Buy" from Analysts

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.

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