Erste Group Bank Comments on Broadcom FY2027 Earnings

Key Points

• Erste Group Bank trimmed Broadcom’s FY2027 EPS estimate to $17.54 from $17.59 and maintained a “Hold” rating, while the broader analyst consensus remains “Moderate Buy” with an average price target of $529.17.
• Broadcom’s latest quarterly results exceeded expectations, with EPS of $3.32 and revenue of $29.59 billion; revenue increased 85.5% year over year, supported by strong semiconductor demand.
• Despite continued AI-chip momentum and institutional ownership of 76.43%, investors face risks from Alphabet diversifying TPU suppliers, growing competition and broader market pressure; Broadcom shares recently traded near the important $320 support level.

Broadcom Inc. (NASDAQ:AVGO - Free Report) - Research analysts at Erste Group Bank reduced their FY2027 earnings estimates for shares of Broadcom in a research note issued to investors on Wednesday, October 21st. Erste Group Bank analyst H. Engel now expects that the semiconductor manufacturer will post earnings per share of $17.54 for the year, down from their prior forecast of $17.59. Erste Group Bank has a "Hold" rating on the stock. The consensus estimate for Broadcom's current full-year earnings is $10.37 per share.

AVGO has been the topic of several other research reports. Citic Securities raised Broadcom to a "buy" rating and increased their price objective for the stock from $450.00 to $525.00 in a research note on Tuesday, September 8th. Truist Financial reduced their price objective on Broadcom from $550.00 to $520.00 and set a "buy" rating on the stock in a report on Thursday, September 3rd. Wall Street Zen lowered Broadcom from a "strong-buy" rating to a "buy" rating in a research report on Saturday, July 18th. Raymond James Financial reaffirmed an "outperform" rating and set a $475.00 target price (up from $450.00) on shares of Broadcom in a research report on Thursday, September 3rd. Finally, Bank of America lowered their target price on Broadcom from $530.00 to $460.00 and set a "buy" rating for the company in a report on Thursday, September 3rd. One analyst has rated the stock with a Strong Buy rating, thirty-eight have issued a Buy rating and three have given a Hold rating to the company. Based on data from MarketBeat.com, Broadcom currently has a consensus rating of "Moderate Buy" and an average target price of $529.17.

Broadcom Stock Performance

Broadcom stock opened at $321.68 on Monday. The company has a 50 day moving average price of $356.05 and a 200-day moving average price of $384.74. The company has a debt-to-equity ratio of 0.57, a quick ratio of 2.29 and a current ratio of 2.50. Broadcom has a fifty-two week low of $289.96 and a fifty-two week high of $495.00. The company has a market capitalization of $1.54 trillion, a PE ratio of 41.08 and a beta of 1.46.

Broadcom (NASDAQ:AVGO - Get Free Report) last released its quarterly earnings data on Wednesday, September 2nd. The semiconductor manufacturer reported $3.32 earnings per share (EPS) for the quarter, beating the consensus estimate of $3.22 by $0.10. The company had revenue of $29.59 billion during 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%. The firm's quarterly revenue was up 85.5% on a year-over-year basis. During the same period in the previous year, the company earned $1.69 EPS.

Broadcom Announces Dividend

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

Institutional Investors Weigh In On Broadcom

Several hedge funds have recently modified their holdings of the business. State Street Corp increased its holdings in shares of Broadcom by 8.7% in the 2nd quarter. State Street Corp now owns 208,031,610 shares of the semiconductor manufacturer's stock valued at $75,367,711,000 after acquiring an additional 16,651,378 shares during the period. Bank of America Corp DE raised its position in shares of Broadcom by 4.6% in the 2nd quarter. Bank of America Corp DE now owns 61,423,013 shares of the semiconductor manufacturer's stock worth $23,202,543,000 after acquiring an additional 2,685,916 shares in the last quarter. Wellington Management Group LLP lifted its stake in shares of Broadcom by 3.8% during the 2nd quarter. Wellington Management Group LLP now owns 51,580,703 shares of the semiconductor manufacturer's stock worth $19,484,611,000 after purchasing an additional 1,892,721 shares during the last quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC lifted its stake in shares of Broadcom by 2.9% during the 2nd quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 40,180,530 shares of the semiconductor manufacturer's stock worth $15,178,195,000 after purchasing an additional 1,140,598 shares during the last quarter. Finally, Legal & General Group Plc purchased a new stake in shares of Broadcom during the 2nd quarter worth $11,998,148,000. Hedge funds and other institutional investors own 76.43% of the company's stock.

Key Headlines Impacting Broadcom

Here are the key news stories impacting Broadcom this week:

• Positive Sentiment: ETF investors bought approximately $89.8 million of Broadcom shares on October 21, signaling continued institutional demand. Broadcom Sees $89.8 Million in Net ETF Buying
• Positive Sentiment: Analysts continue to highlight Broadcom’s leadership in custom AI accelerators. Demand from major AI labs and hyperscalers, including Anthropic, OpenAI and Meta, supports management’s ambitious long-term AI semiconductor growth outlook. 3 Magnificent AI Chip Stocks
• Positive Sentiment: Tigress Financial initiated coverage with a Buy rating and a $600 price target, implying substantial upside from recent trading levels. Tigress Financial Broadcom Coverage
• Positive Sentiment: Broadcom launched Arcot Scam Defense, a real-time fraud-detection feature for digital payments. Strong initial pilot results could create incremental growth for its software and security businesses. Broadcom Debuts Arcot Scam Defense
• Neutral Sentiment: Broadcom remains the leading custom-chip design partner, but Alphabet is diversifying its TPU suppliers. Although Broadcom may lose market share, the overall AI accelerator market is expected to expand rapidly, potentially offsetting that loss. Broadcom AI Chip Business Risks
• Negative Sentiment: Investors are worried that customer-owned chip design and increased competition from MediaTek could reduce Broadcom’s role and margins in future AI programs. Alphabet’s supplier diversification is the clearest near-term risk. Broadcom AI Chip Business Risks
• Negative Sentiment: The broader market sell-off is weighing on AI stocks amid higher oil prices, inflation concerns and questions about whether massive data-center investments will generate sufficient returns. Technical commentary identifies the $320 area as an important support test. Broadcom Faces Critical $320 Test

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.

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