Broadcom (NASDAQ:AVGO) Shares Up 1.7% - What's Next?

Shares of Broadcom Inc. (NASDAQ:AVGO) increased by 1.7% on Wednesday, reaching a high of $175.39 before closing at $171.01. The trading volume was recorded at 6,678,305 shares, significantly lower than the average session volume of 28,924,539 shares, with the previous closing price being $168.15.

Changes in Analyst Ratings

Recently, several research firms have updated their ratings and price targets for Broadcom's shares. Truist Financial raised their target from $204.00 to $205.00 while maintaining a "buy" rating on October 8th. TD Cowen upgraded Broadcom to a "strong-buy" rating on September 16th. Similarly, JPMorgan Chase & Co. adjusted their price target from $200.00 to $210.00, giving the stock an "overweight" rating on September 6th. Benchmark also kept a "buy" stance with a $210.00 price target. Furthermore, Morgan Stanley bumped their target from $176.00 to $180.00 with an "overweight" recommendation on the same date.

Currently, two analysts have issued a hold rating, while twenty-three have recommended buying the stock, and one analyst has given it a "strong buy" rating. MarketBeat data indicates that Broadcom holds a consensus rating of "Moderate Buy" with an average target price of $195.96.

Overview of Broadcom's Stock Performance

The company commands a market capitalization of approximately $788.95 billion with a PE ratio of 148.58 and a PEG ratio of 1.96. Its debt-to-equity ratio stands at 1.02, and current financial ratios include a quick ratio of 0.94 and a current ratio of 1.04. Broadcom's stock has a 50-day moving average of $173.12 and a 200-day moving average of $162.12.

On September 5th, Broadcom reported its latest earnings, announcing earnings per share of $1.24 for the recent quarter, surpassing the analyst expectation of $1.20 by $0.04. The company achieved revenues of $13.07 billion during this period, exceeding estimates of $12.98 billion, and marking a 47.3% increase from the same quarter the previous year. Analysts predict that Broadcom will achieve an EPS of 3.78 for the current financial year.

Dividend Announcement from Broadcom

Recently, Broadcom declared a quarterly dividend of $0.53, which was paid out on September 30th to investors on record as of September 19th. This dividend is consistent with the previous quarterly payment. The annualized dividend comes to $2.12, resulting in a yield of 1.26%. Broadcom's dividend payout ratio is notably high at 184.19%.

Insider Sales at Broadcom

In a related development, CEO Hock E. Tan sold 150,000 shares of Broadcom on September 24th at an average price of $172.94, bringing in a total of approximately $25.94 million. Following this transaction, he retains ownership of 1,181,910 shares valued at around $204.39 million. This sale reduced his holdings by 11.26% as disclosed to the Securities & Exchange Commission. Another insider, Charlie B. Kawwas, sold 15,950 shares on October 11th for about $2.89 million, which represented a 2.12% decrease in his stake. Over the last quarter, insiders have sold about 311,080 shares totaling over $53.54 million, with insiders holding 2.00% of the company's stock.

Institutional Investor Trends

Institutional investors and hedge funds have recently adjusted their positions in Broadcom. For example, Indiana Trust & Investment Management CO increased its stake by 39.5% in the second quarter, acquiring 53 shares valued at $85,000. Salem Investment Counselors raised their holdings by 2.9% to own 2,712 shares worth $4.35 million. Other funds, like TTP Investments Inc., Cherrydale Wealth Management LLC, and Prentice Wealth Management LLC, have also made minor increases in their investments in Broadcom. In total, institutional investors hold a significant 76.43% of the company’s shares.

About Broadcom

Broadcom Inc. specializes in designing, developing, and supplying a diverse range of semiconductor devices, focusing primarily on complex digital and mixed-signal complementary metal oxide semiconductor (CMOS) products as well as analog III-V based solutions globally. The company's operations are divided into two main segments: Semiconductor Solutions and Infrastructure Software.

Broadcom, Investment, Stocks