Broadcom (NASDAQ:AVGO) Reaches New 1-Year High After Strong Earnings

Key Points

• Broadcom's stock price reached a new 52-week high of $356.34 after a strong earnings report, closing at $338.15, up from $306.10.
• The company reported earnings per share (EPS) of $1.69 and revenue of $15.95 billion for the quarter, exceeding analyst estimates and representing a year-over-year revenue increase of 22%.
• Broadcom announced a quarterly dividend of $0.59, set to be paid on September 30th, and has a current payout ratio of 88.39%.

Broadcom Inc. (NASDAQ:AVGO - Get Free Report)'s share price reached a new 52-week high during trading on Friday following a stronger than expected earnings report. The stock traded as high as $356.34 and last traded at $338.15, with a volume of 26229748 shares trading hands. The stock had previously closed at $306.10.

The semiconductor manufacturer reported $1.69 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $1.66 by $0.03. The company had revenue of $15.95 billion during the quarter, compared to the consensus estimate of $15.82 billion. Broadcom had a return on equity of 35.49% and a net margin of 22.64%.Broadcom's revenue was up 22.0% on a year-over-year basis. During the same period last year, the company earned $1.24 earnings per share. Broadcom has set its Q4 2025 guidance at EPS.

Broadcom Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Tuesday, September 30th. Stockholders of record on Monday, September 22nd will be issued a $0.59 dividend. This represents a $2.36 annualized dividend and a dividend yield of 0.7%. Broadcom's payout ratio is 88.39%.

Analyst Upgrades and Downgrades

Several equities analysts recently commented on the company. Arete Research raised Broadcom to a "strong-buy" rating in a research report on Monday, July 28th. Redburn Atlantic assumed coverage on Broadcom in a report on Wednesday, May 28th. They issued a "buy" rating and a $301.00 price objective for the company. Cowen reaffirmed a "buy" rating on shares of Broadcom in a report on Friday, June 6th. UBS Group raised their target price on Broadcom from $290.00 to $345.00 and gave the stock a "buy" rating in a research note on Monday, August 25th. Finally, Mizuho boosted their target price on Broadcom from $315.00 to $320.00 and gave the stock an "outperform" rating in a research report on Wednesday, July 16th. Three analysts have rated the stock with a Strong Buy rating, twenty-six have given a Buy rating and one has issued a Hold rating to the company. Based on data from MarketBeat.com, Broadcom currently has an average rating of "Buy" and a consensus target price of $337.92.

Insiders Place Their Bets

In related news, CEO Hock E. Tan sold 40,000 shares of Broadcom stock in a transaction on Thursday, June 26th. The shares were sold at an average price of $268.29, for a total transaction of $10,731,600.00. Following the sale, the chief executive officer directly owned 482,836 shares in the company, valued at $129,540,070.44. This trade represents a 7.65% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, Director Henry Samueli sold 473,898 shares of the business's stock in a transaction dated Wednesday, June 25th. The stock was sold at an average price of $265.33, for a total transaction of $125,739,356.34. Following the sale, the director directly owned 38,188,575 shares in the company, valued at approximately $10,132,574,604.75. This represents a 1.23% decrease in their position. The disclosure for this sale can be found here. Over the last 90 days, insiders have sold 830,516 shares of company stock worth $217,286,457. 2.00% of the stock is currently owned by company insiders.

Institutional Trading of Broadcom

A number of institutional investors and hedge funds have recently modified their holdings of AVGO. Norges Bank bought a new position in shares of Broadcom during the 2nd quarter valued at about $18,579,549,000. Nuveen LLC acquired a new position in shares of Broadcom in the 1st quarter valued at approximately $6,649,117,000. Price T Rowe Associates Inc. MD increased its position in Broadcom by 37.8% during the 1st quarter. Price T Rowe Associates Inc. MD now owns 65,509,579 shares of the semiconductor manufacturer's stock worth $10,968,270,000 after buying an additional 17,985,046 shares during the period. GAMMA Investing LLC boosted its stake in shares of Broadcom by 18,179.3% during the first quarter. GAMMA Investing LLC now owns 17,276,164 shares of the semiconductor manufacturer's stock valued at $2,892,548,000 after purchasing an additional 17,181,652 shares in the last quarter. Finally, Vanguard Group Inc. raised its position in shares of Broadcom by 1.3% during the second quarter. Vanguard Group Inc. now owns 483,442,939 shares of the semiconductor manufacturer's stock worth $133,261,046,000 after purchasing an additional 6,222,802 shares during the period. 76.43% of the stock is owned by institutional investors and hedge funds.

Broadcom Price Performance

The stock has a market cap of $1.59 trillion, a P/E ratio of 126.12, a P/E/G ratio of 2.15 and a beta of 1.16. The company has a debt-to-equity ratio of 0.89, a quick ratio of 0.98 and a current ratio of 1.08. The business has a 50 day simple moving average of $290.78 and a 200-day simple moving average of $236.51.

About Broadcom

Broadcom Inc designs, develops, and supplies various semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products worldwide. The company operates in two segments, Semiconductor Solutions and Infrastructure Software.

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