Broadcom (NASDAQ:AVGO) Trading Down 4.8% - Here's What Happened

Key Points

• Broadcom shares fell 4.8% to $344.72 in heavy trading, with volume roughly 25% above the average session. The decline leaves the stock below its 50-day and 200-day moving averages.
• AI remains Broadcom’s key growth driver: CEO Hock Tan reportedly said demand for custom AI processors already exceeds the company’s $115 billion forecast, while shipments to Anthropic could further expand its custom-chip business.
• Despite the selloff, analysts maintain a broadly positive view, with Broadcom carrying a “Moderate Buy” consensus rating and a $505.97 average price target. The company also exceeded quarterly earnings and revenue expectations, reporting $3.32 EPS and $29.59 billion in revenue.

Shares of Broadcom Inc. (NASDAQ:AVGO - Get Free Report) were down 4.8% on Monday . The stock traded as low as $343.91 and last traded at $344.72. Approximately 31,572,775 shares were traded during trading, an increase of 25% from the average session volume of 25,225,260 shares. The stock had previously closed at $361.99.

Broadcom News Summary

Here are the key news stories impacting Broadcom this week:

• Positive Sentiment: Long-term AI demand remains a major catalyst. Broadcom CEO Hock Tan reportedly said demand for the company’s custom AI processors already exceeds its $115 billion forecast, with AI revenue expected to double in fiscal 2027 and again in 2028. Hyperscalers and frontier AI companies are increasingly using Broadcom-designed processors. Broadcom CEO Hock Tan Says Demand Already Exceeds Broadcom's $115 Billion AI Forecast
• Positive Sentiment: Custom-chip partnerships could expand growth. Accelerating Ironwood shipments to Anthropic highlights Broadcom’s role in the expanding custom AI hardware market and may strengthen the economics of Google’s TPU ecosystem for Broadcom. Broadcom’s Anthropic Ramp Puts Google’s TPU Business in a Different Light
• Positive Sentiment: Some analysts see substantial upside. Mizuho analyst Vijay Rakesh expects AVGO to rally toward a new all-time high over the next 12 months, while other commentary points to strong AI-driven revenue growth. Wall Street sets Broadcom stock price for the next 12 months

Analyst Ratings Changes

Several brokerages have weighed in on AVGO. KeyCorp reiterated an "overweight" rating and issued a $575.00 price objective on shares of Broadcom in a research report on Thursday, September 3rd. Deutsche Bank Aktiengesellschaft restated a "buy" rating and issued a $515.00 target price (up from $430.00) on shares of Broadcom in a report on Thursday, June 4th. Wall Street Zen downgraded shares of Broadcom from a "strong-buy" rating to a "buy" rating in a research note on Saturday, July 18th. Piper Sandler assumed coverage on shares of Broadcom in a report on Wednesday. They set an "overweight" rating and a $460.00 price target for the company. Finally, Dbs Bank raised shares of Broadcom to a "moderate buy" rating in a research report on Thursday, June 18th. One investment analyst has rated the stock with a Strong Buy rating, twenty-nine have issued a Buy rating and four have assigned a Hold rating to the company. According to MarketBeat, the stock presently has an average rating of "Moderate Buy" and a consensus price target of $505.97.

Broadcom Stock Down 4.8%

The company's fifty day simple moving average is $383.03 and its 200 day simple moving average is $378.66. 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 firm has a market capitalization of $1.65 trillion, a P/E ratio of 44.03 and a beta of 1.44.

Broadcom (NASDAQ:AVGO - Get Free Report) last released its earnings results on Wednesday, September 2nd. The semiconductor manufacturer reported $3.32 EPS for the quarter, beating analysts' consensus estimates of $3.22 by $0.10. Broadcom had a return on equity of 48.33% and a net margin of 42.94%.The company had revenue of $29.59 billion during the quarter, compared to analysts' expectations of $29.24 billion. During the same quarter last year, the business posted $1.69 EPS. The firm's revenue for the quarter was up 85.5% compared to the same quarter last year. Research analysts expect that Broadcom Inc. will post 10.36 EPS for the current year.

Broadcom Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, September 30th. Shareholders of record on Monday, September 21st will be given a dividend of $0.65 per share. The ex-dividend date of this dividend is Monday, September 21st. This represents a $2.60 annualized dividend and a yield of 0.8%. Broadcom's dividend payout ratio (DPR) is currently 33.21%.

Insider Activity

In related news, Director Gayla J. Delly sold 1,890 shares of the stock in a transaction dated Wednesday, July 8th. The shares were sold at an average price of $385.38, for a total value of $728,368.20. Following the completion of the transaction, the director directly owned 31,326 shares in the company, valued at $12,072,413.88. This trade represents a 5.69% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, insider Mark Brazeal sold 25,000 shares of Broadcom stock in a transaction dated Friday, July 10th. The shares were sold at an average price of $401.33, for a total transaction of $10,033,250.00. Following the transaction, the insider directly owned 194,989 shares of the company's stock, valued at approximately $78,254,935.37. This trade represents a 11.36% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. In the last 90 days, insiders have sold 61,644 shares of company stock worth $24,016,214. Corporate insiders own 1.90% of the company's stock.

Institutional Trading of Broadcom

Hedge funds have recently made changes to their positions in the stock. Cornerstone Advisors LLC acquired a new position in shares of Broadcom during the second quarter worth about $92,522,000. Bank of America Corp DE lifted its position in Broadcom by 1.5% in the first quarter. Bank of America Corp DE now owns 58,737,097 shares of the semiconductor manufacturer's stock valued at $18,179,719,000 after purchasing an additional 894,564 shares during the period. Clear Harbor Asset Management LLC purchased a new stake in Broadcom in the 2nd quarter valued at approximately $3,302,000. Bartlett & CO. Wealth Management LLC boosted its holdings in Broadcom by 129.3% in the 1st quarter. Bartlett & CO. Wealth Management LLC now owns 110,048 shares of the semiconductor manufacturer's stock valued at $34,061,000 after purchasing an additional 62,050 shares in the last quarter. Finally, First Bank & Trust increased its position in Broadcom by 17.2% during the 2nd quarter. First Bank & Trust now owns 10,503 shares of the semiconductor manufacturer's stock worth $3,968,000 after purchasing an additional 1,545 shares during the period. 76.43% of the stock is owned by institutional investors.

About Broadcom

Broadcom Inc NASDAQ: AVGO designs, develops and supplies semiconductor and infrastructure software products for businesses, telecommunications providers and other organizations worldwide. Its semiconductor portfolio includes networking and connectivity components, custom application-specific integrated circuits, broadband and wireless communications products, storage adapters, optical components, and industrial solutions.

The company also provides enterprise infrastructure software through businesses including VMware, which offers virtualization and private- and hybrid-cloud solutions; mainframe and enterprise software; and cybersecurity products.

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