Broadcom Inc. (NASDAQ: AVGO) has received a significant upgrade from Wall Street Zen, moving its rating from “hold” to “buy.” This adjustment comes as part of a broader trend among financial analysts who are increasingly optimistic about the semiconductor giant’s future performance.
Several notable financial institutions have also provided updated assessments of Broadcom’s stock. On August 13, 2023, Goldman Sachs reaffirmed its “buy” rating, setting a target price of $340.00. More recently, Piper Sandler raised its target from $315.00 to $375.00, assigning an “overweight” rating. Other firms, including Deutsche Bank Aktiengesellschaft and Wells Fargo & Company, have also revised their target prices upwards to $350.00 and $345.00, respectively.
As of now, three analysts have rated Broadcom with a “strong buy,” while twenty-seven have given it a “buy” rating, and only one has issued a “hold.” According to data from MarketBeat.com, the stock currently holds a consensus rating of “buy” with an average target price of $351.00.
Strong Earnings Report Boosts Confidence
Broadcom’s recent earnings announcement on September 4, 2023, further solidified this positive outlook. The company reported earnings per share (EPS) of $1.69 for the quarter, exceeding analysts’ expectations of $1.66 by $0.03. The semiconductor manufacturer achieved a net margin of 31.59% and a return on equity of 37.17%. Revenues reached $15.95 billion, surpassing forecasts of $15.82 billion, and representing a year-over-year increase of 22.0% compared to the same quarter last year, when it earned $1.24 per share.
Looking ahead, Broadcom has set guidance for Q4 2025 and analysts predict an annual EPS of 5.38 for the current fiscal year.
Insider Trading Activity
In related news, insider trading activity reveals that Director Henry Samueli sold 473,898 shares of Broadcom on June 25, 2023. The sale, which occurred at an average price of $265.33, totaled approximately $125.74 million. Following this transaction, Samueli retained ownership of 38,188,575 shares, valued at around $10.13 billion. This sale represents a 1.23% reduction in his stake in the company.
Additionally, Kirsten M. Spears, the Chief Financial Officer, sold 56,310 shares on June 18, 2023, at an average price of $251.75, amounting to a total of $14.18 million. After this transaction, she directly owned 361,937 shares, valued at approximately $91.12 million, marking a 13.46% decrease in her position.
Over the past 90 days, insiders have sold a total of 830,516 shares worth approximately $217.29 million. Currently, insiders hold 2.00% of the company’s stock.
Institutional Investment Trends
Recent activity among hedge funds also indicates growing interest in Broadcom. For instance, Barnes Dennig Private Wealth Management LLC and Cheviot Value Management LLC each acquired new positions in Broadcom during the first quarter, valued at $25,000. Inlight Wealth Management LLC followed suit with a stake worth $26,000. Furthermore, Sawyer & Company Inc. increased its stake by 62.1% in the second quarter, now owning 94 shares valued at $26,000 after purchasing an additional 36 shares.
Currently, hedge funds and institutional investors collectively own approximately 76.43% of Broadcom’s stock.
Broadcom Inc. specializes in designing, developing, and supplying a range of semiconductor devices, focusing on complex digital and mixed-signal complementary metal-oxide-semiconductor products and analog III-V based devices. The company operates through two primary segments: Semiconductor Solutions and Infrastructure Software.
As market dynamics continue to evolve, all eyes will be on Broadcom as it navigates its growth trajectory in the semiconductor industry.
