Broadcom's Stock Surges Amid AI Boom and Strong Tech Sector Performance

Broadcom (AVGO) Stock Climbs As Meta and Microsoft Results Signal Soaring AI And Data Center Demand - Broadcom (NASDAQ:AVGO)

Feel unsure about the market's next move? Copy trade alerts from Matt Maley -- a Wall Street veteran who consistently finds profits in volatile markets. Claim your 7-day free trial now. Broadcom Inc AVGO saw its stock rise 3.3% to $198.83 Thursday following blockbuster earnings reports from both Meta Platforms and Microsoft Corp, which highlighted surging capital expenditures and expanding cloud infrastructure -- key areas where Broadcom is deeply entrenched. What To Know: Meta's first-quarter results revealed a significant increase in capital spending, now forecast to reach as high as $72 billion for the full year, largely driven by investments in AI and data centers. Microsoft also delivered strong cloud growth, with Azure revenue surging 33% and total Microsoft Cloud revenue hitting $42.4 billion, up 20% year-over-year. Broadcom, a leading semiconductor and infrastructure software company, plays a critical role in powering hyperscale data centers and AI workloads through its networking chips, custom silicon, and switching technologies. As companies like Meta and Microsoft aggressively expand their AI infrastructure, Broadcom stands to benefit directly from increased orders for its high-performance chips and interconnect solutions. The company is also a key supplier for custom ASICs used in AI and machine learning systems. With hyperscaler demand accelerating, investors could be betting Broadcom's future earnings will reflect this booming market. Read Also: Nvidia Stock Surges After Hours: What's Going On? How To Buy AVGO Stock By now you're likely curious about how to participate in the market for Broadcom - be it to purchase shares, or even attempt to bet against the company. Buying shares is typically done through a brokerage account. You can find a list of possible trading platforms here. Many will allow you to buy "fractional shares," which allows you to own portions of stock without buying an entire share. In the case of Broadcom, which is trading at $198.07 as of publishing time, $100 would buy you 0.5 shares of stock. If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to "go short" a share of stock by lending you the shares to sell. The process of shorting a stock can be found at this resource. Otherwise, if your broker allows you to trade options, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading - either way it allows you to profit off of the share price decline. According to data from Benzinga Pro, AVGO has a 52-week high of $251.88 and a 52-week low of $122.33. AVGOBroadcom Inc$198.012.88%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum89.51Growth78.62Quality83.81Value9.31Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs

Why Broadcom Stock Eked out a win on Wednesday

On a fairly forgettable Wednesday for U.S. stock markets, Broadcom (AVGO 0.76%) was a bit of an outperformer. The company's stock saw a bump in price, rising by 0.7% after an analyst initiated coverage with a positive evaluation. That performance, although modest, was good enough to top the essentially flat-lining S&P 500 index. A potential 20% price gain That morning, before the market's opening bell, Seaport Global Securities's Jay Goldberg launched his coverage of Broadcom. Happily for the company and its investors, Goldberg rated the sturdy tech stock as a buy, at a price target of $230 per share. That figure anticipates nearly 20% upside to the current price. According to reports, Goldberg's bullish take on Broadcom is due to several factors, among which is its determination to address the demands for artificial intelligence (AI) functionalities. The analyst believes the company is one of the leading beneficiaries of the surge in spending for such functionalities, but this isn't yet priced into its stock. He also pointed to Broadcom's impressive client list, which includes sector powerhouses such as Alphabet's Google, Apple, and TikTok. He also mentioned that the company's core, non-AI products are very competitive on the market and quite profitable to boot. Varied sources of revenue Broadcom is a robust and successful business that has several thick revenue streams, not least of which is its custom chip offerings. I'd agree with Goldberg's assessment that its commitment to AI isn't fully appreciated by the market, and I think his buy recommendation on the shares is entirely justified.

Why Broadcom Stock Jumped 15% in April | The Motley Fool

Shares of Broadcom (AVGO -0.88%) were bucking the broader trend in the market last month as a well-timed buyback announcement, generally positive analyst research, and a new product announcement lifted the stock. According to data from S&P Global Market Intelligence, the stock finished the month up 15%. As you can see from the chart below, Broadcom got a lift from the share buyback announcement at the beginning of the month and then tracked similarly to the S&P 500 for the duration of April but with greater upside. Like the rest of the stock market, Broadcom shares dove in response to the Trump tariffs announcement. However, the stock rebounded quickly after the company delighted investors by announcing a $10 billion share repurchase program on April 7. While that represents only about 1% of the company's market cap, it represented a sign of confidence from management in the face of the uncertainty around the trade war and showed that it was eager to take advantage of any discount in the stock price. Broadcom stock jumped 5.4% on April 7 as a result, even as the broad market fell again. On April 9, it surged 19% on news that President Trump was announcing a 90-day pause on most of the "reciprocal tariffs" he had declared the week before. As a cyclical stock sensitive to the global economy, Broadcom was able to outperform the market on that news. Later in the month, the company announced an advancement in its Symantec cybersecurity business with Incident Protection, an artificial intelligence (AI) tool that predicts cyberattacker behavior. Finally, Broadcom benefited from an upswing at the end of the month as fears about the trade war tamped down on news reports that the U.S. and China were open to trade talks. On April 30, Seaport Research initiated coverage of the stock with a buy, noting that Broadcom was well positioned to benefit from the hyperscalers' intentions to design their own chips, as it's considered a leader in custom ASIC chips, which the big cloud companies are turning to as a potential replacement for some Nvidia GPUs. Broadcom won't report its next earnings results until June, but the company seems well positioned to benefit from the tailwind in AI and ride out any broader market turmoil, thanks in part to its diversification across networking chips, infrastructure products, virtualization software, and cybersecurity. The chip giant looks like a good bet to continue to outperform the market, especially as its AI business appears to be gaining momentum.

Meet the Monster Stock that Continues to Crush the Market | The Motley Fool

Broadcom is still a great long-term play on the cybersecurity, cloud, and AI markets. Back in 2023, only 27% of the stocks in the S&P 500 outperformed the broader index. That ratio, which represented its lowest percentage in three decades, and only rose to 28% in 2024. Those low percentages support the idea that it's smarter to invest in an S&P 500 index fund than to try to time and beat the market with individual stocks. However, some of those S&P 500 stocks which consistently outperform the market might still be worth buying as long-term investments. One of those market-beating stocks is Broadcom (AVGO -1.43%), which was formerly known as Avago before it acquired the original Broadcom and inherited its brand in 2016. Over the past five years, Broadcom's stock surged more than 680% as the S&P 500 roughly doubled. Let's see why this monster stock keeps crushing the market -- and why if it's still worth buying today. Before Avago acquired the original Broadcom for $37 billion, it sold a wide range of wireless, storage, networking, optical, custom, and radio frequency chips. That "old" Broadcom competed against Avago in the storage and networking chip market, but it also sold a wider range of mobile, multimedia, and Wi-Fi/Bluetooth combo chips. The "new" Broadcom didn't produce any high-end chips, but its products remained essential for many enterprise, industrial, and mobile customers. From fiscal 2016 to fiscal 2024 (which ended last November), Broadcom's revenue grew at a compound annual growth rate (CAGR) of 18.5%. A lot of that growth was driven by its big acquisitions -- which included the storage networking products provider Brocade in 2017, the mainframe and enterprise software provider CA Technologies in 2018, Symantec's enterprise security business in 2019, and the cloud software giant VMware in 2023. Through those acquisitions, Broadcom evolved from a chipmaker into a more diversified tech company which generated 42% of its revenue from the infrastructure software business in fiscal 2024. The remaining 58% came from its semiconductor solutions business. That diversification gives Broadcom more protection from the semiconductor market's cyclical downturns while increasing its exposure to the growing cloud and cybersecurity software markets. Data centers are also installing more of Broadcom's networking, optical, and custom accelerator chips to power their latest AI applications. Those catalysts are helping Broadcom grow much faster than other comparable chipmakers like Texas Instruments. In fiscal 2024, Broadcom's sales of AI-oriented chips surged 220% to $12.2 billion. That accounted for 41% of its semiconductor revenue and 24% of its total revenue. That growth offset its slower sales of non-AI chips and infrastructure software, while its total revenue -- boosted by its takeover of Vmware -- increased 44% for the full year. In the first quarter of fiscal 2025, Broadcom's AI-oriented revenue surged 77% year over year to $4.1 billion and accounted for 27% of its top line. The company expects its AI sales to rise another 44% year over year to $4.4 billion in the second quarter. So while Broadcom doesn't produce high-powered data center GPUs like Nvidia, it's still clearly a major beneficiary of the AI boom. Yet Broadcom's business isn't completely immune to the macro headwinds. Tariff-stricken companies could scale back spending on new AI, cloud, and cybersecurity services. Trade wars could disrupt its supply chains. Companies which rely heavily on overseas components and labor -- like its top chip customer Apple -- could buy fewer chips as those headwinds intensify. From fiscal 2024 to fiscal 2027, analysts expect Broadcom's revenue to increase at a CAGR of 17% as its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) -- which smooths out the impact of its recent acquisitions -- rises at a CAGR of 21%. With an enterprise value of $1 trillion, Broadcom's stock still looks reasonably valued at 24 times this year's adjusted EBITDA -- and it could continue to outperform the market as long as its AI business keeps expanding. The stock might remain volatile this year as the tariffs and trade wars rattle the markets, but it's still a promising long-term play for patient investors.

Broadcom Stock: Buy This Dip - Solid Upside Ahead (NASDAQ:AVGO)

Broadcom's AI-related revenue is growing rapidly, with projections to reach $20 billion annually by 2027, driven by strong demand for AI and networking solutions. President Trump's supporters who had high hopes for a booming stock market in 2025 have been let down. The excitement of his first two months in office quickly turned into a "crippling" period for growth and tech investors. I am Sayra Quraishi, a dedicated stock analyst with over a decade of experience. My expertise in market trends and investment strategies in the financial industry. As a part-time investor, I apply my market knowledge to a diverse portfolio, focusing on sectors like technology, healthcare, and renewable energy. I also contribute to financial publications and speak at industry events, sharing insights to help others navigate the world of investing. My approach blends in-depth research with strategic insights, aiming to identify high-potential opportunities across dynamic industries. Analyst's Disclosure: I/we have a beneficial long position in the shares of AVGO either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.