Broadcom (NASDAQ:AVGO) Trading Down 1.1% - Time to Sell?

Key Points

• Broadcom shares fell 1.1% on Monday, trading as low as $414.37 before closing at $420.71 on lighter-than-average volume.
• Despite the dip, analysts remain broadly positive: Broadcom has a “Moderate Buy” consensus rating and an average price target of $442.13, with several firms recently raising targets to $480-$500.
• The company continues to show strong fundamentals, having recently reported better-than-expected earnings and revenue with 29.5% year-over-year revenue growth, while also paying a quarterly dividend of $0.65 per share.

Broadcom Inc. (NASDAQ:AVGO - Get Free Report)'s stock price traded down 1.1% on Monday . The stock traded as low as $414.37 and last traded at $420.71. 16,906,037 shares were traded during mid-day trading, a decline of 31% from the average session volume of 24,641,506 shares. The stock had previously closed at $425.19.

Wall Street Analyst Weigh In

Several analysts have commented on AVGO shares. Mizuho restated an "outperform" rating and set a $480.00 price objective on shares of Broadcom in a research note on Thursday, April 16th. Wolfe Research upgraded shares of Broadcom from a "peer perform" rating to an "outperform" rating and set a $400.00 price objective on the stock in a research note on Friday, January 30th. TD Cowen reissued a "buy" rating and set a $500.00 target price (up from $405.00) on shares of Broadcom in a report on Friday. JPMorgan Chase & Co. upped their price target on shares of Broadcom from $475.00 to $500.00 and gave the company an "overweight" rating in a report on Thursday, March 5th. Finally, Citigroup reaffirmed a "buy" rating and set a $500.00 price target (up from $475.00) on shares of Broadcom in a research report on Tuesday, May 12th. Two investment analysts have rated the stock with a Strong Buy rating, twenty-seven have assigned a Buy rating and four have issued a Hold rating to the company. According to data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and a consensus target price of $442.13.

Broadcom Stock Performance

The company has a current ratio of 1.90, a quick ratio of 1.73 and a debt-to-equity ratio of 0.80. The firm's fifty day moving average price is $365.61 and its two-hundred day moving average price is $354.56. The stock has a market capitalization of $1.99 trillion, a PE ratio of 82.17, a price-to-earnings-growth ratio of 0.88 and a beta of 1.43.

Broadcom (NASDAQ:AVGO - Get Free Report) last announced its quarterly earnings results on Wednesday, March 4th. The semiconductor manufacturer reported $2.05 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $2.03 by $0.02. The firm had revenue of $19.31 billion for the quarter, compared to the consensus estimate of $19.10 billion. Broadcom had a net margin of 36.57% and a return on equity of 38.61%. The firm's quarterly revenue was up 29.5% compared to the same quarter last year. During the same period in the prior year, the firm posted $1.60 earnings per share. As a group, equities research analysts forecast that Broadcom Inc. will post 9.95 EPS for the current year.

Broadcom Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Tuesday, March 31st. Stockholders of record on Monday, March 23rd were given a dividend of $0.65 per share. The ex-dividend date was Monday, March 23rd. This represents a $2.60 dividend on an annualized basis and a dividend yield of 0.6%. Broadcom's dividend payout ratio (DPR) is 50.78%.

Insiders Place Their Bets

In other Broadcom news, CFO Kirsten M. Spears sold 36,292 shares of the firm's stock in a transaction that occurred on Tuesday, March 17th. The stock was sold at an average price of $321.60, for a total value of $11,671,507.20. Following the sale, the chief financial officer directly owned 327,760 shares of the company's stock, valued at approximately $105,407,616. This trade represents a 9.97% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, insider Charlie B. Kawwas sold 39,116 shares of the company's stock in a transaction that occurred on Tuesday, March 17th. The stock was sold at an average price of $321.61, for a total value of $12,580,096.76. Following the transaction, the insider directly owned 74,626 shares of the company's stock, valued at approximately $24,000,467.86. The trade was a 34.39% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 324,282 shares of company stock worth $106,425,249 in the last 90 days. 1.90% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Broadcom

Institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Eley Financial Management Inc lifted its holdings in Broadcom by 25.2% during the first quarter. Eley Financial Management Inc now owns 23,099 shares of the semiconductor manufacturer's stock valued at $7,149,000 after purchasing an additional 4,656 shares in the last quarter. Empowered Funds LLC increased its stake in shares of Broadcom by 64.9% during the first quarter. Empowered Funds LLC now owns 699,504 shares of the semiconductor manufacturer's stock worth $216,503,000 after purchasing an additional 275,197 shares in the last quarter. Evelyn Partners Investment Management LLP increased its stake in shares of Broadcom by 118.1% during the first quarter. Evelyn Partners Investment Management LLP now owns 59,969 shares of the semiconductor manufacturer's stock worth $18,561,000 after purchasing an additional 32,470 shares in the last quarter. Evelyn Partners Investment Management Services Ltd raised its position in shares of Broadcom by 80.2% during the 1st quarter. Evelyn Partners Investment Management Services Ltd now owns 15,630 shares of the semiconductor manufacturer's stock worth $4,838,000 after purchasing an additional 6,955 shares during the last quarter. Finally, The Manufacturers Life Insurance Company lifted its stake in Broadcom by 21.2% in the 1st quarter. The Manufacturers Life Insurance Company now owns 5,310,766 shares of the semiconductor manufacturer's stock valued at $1,643,640,000 after buying an additional 928,806 shares in the last quarter. Hedge funds and other institutional investors own 76.43% of the company's stock.

About Broadcom

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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