Broadcom (NASDAQ:AVGO) Trading Down 12.6% – Here’s Why

Shares of Broadcom Inc. (NASDAQ:AVGO) were down 12.6% on Thursday . The stock traded as low as $403.01 and last traded at $418.91. Approximately 80,138,932 shares were traded during trading, an increase of 217% from the average daily volume of 25,318,520 shares. The stock had previously closed at $479.23.

Key Headlines Impacting Broadcom

Here are the key news stories impacting Broadcom this week:

• Positive Sentiment: Broadcom reported strong fiscal Q2 results, with earnings of $2.44 per share topping estimates and revenue rising 48% year over year to $22.19 billion, driven by surging AI chip demand. Broadcom Inc. Announces Second Quarter Fiscal Year 2026 Financial Results and Quarterly Dividend
• Positive Sentiment: The company’s AI semiconductor revenue more than doubled to $10.8 billion, showing continued momentum in custom AI accelerators and networking. Broadcom Revenue Climbs on AI Chip Demand
• Positive Sentiment: Several analysts raised price targets after the report, signaling that Wall Street still sees upside despite the selloff. Analyst target raises referenced in Benzinga
• Neutral Sentiment: Broadcom declared a quarterly dividend of $0.65 per share, which supports the stock’s income appeal but is not the main driver of today’s move. Broadcom Inc. Announces Second Quarter Fiscal Year 2026 Financial Results and Quarterly Dividend
• Negative Sentiment: Shares are falling because Broadcom’s third-quarter AI revenue guidance of about $16 billion came in below some investor expectations, raising concerns that AI growth may not be accelerating as quickly as the market hoped. Broadcom tumbles as revenue miss clouds AI boom bets
• Negative Sentiment: The post-earnings selloff is also pressuring other chip stocks, suggesting investors are reassessing how much AI optimism is already priced into the semiconductor rally. Stock Market Today: Nasdaq 100 Slips As Broadcom Plunges, Bitcoin Hits 4-Month Lows

Wall Street Analyst Weigh In

A number of research analysts have recently issued reports on the stock. Seaport Research Partners restated a “neutral” rating on shares of Broadcom in a research report on Wednesday, April 8th. Rosenblatt Securities reaffirmed a “buy” rating and set a $500.00 price objective on shares of Broadcom in a research report on Thursday. Morgan Stanley set a $502.00 price objective on shares of Broadcom and gave the stock an “overweight” rating in a research note on Thursday. Evercore reiterated an “outperform” rating and set a $582.00 price objective on shares of Broadcom in a research note on Tuesday, May 19th. Finally, Erste Group Bank lowered shares of Broadcom from a “buy” rating to a “hold” rating in a research note on Thursday, April 2nd. One investment analyst has rated the stock with a Strong Buy rating, twenty-eight have given a Buy rating and four have issued a Hold rating to the stock. According to data from MarketBeat.com, Broadcom presently has a consensus rating of “Moderate Buy” and an average target price of $490.13.

Broadcom Trading Down 12.6%

The company has a quick ratio of 1.73, a current ratio of 1.90 and a debt-to-equity ratio of 0.80. The stock has a market cap of $1.98 trillion, a price-to-earnings ratio of 81.82, a price-to-earnings-growth ratio of 0.99 and a beta of 1.41. The firm’s 50 day moving average is $392.87 and its two-hundred day moving average is $361.19.

Broadcom (NASDAQ:AVGO) last posted its earnings results on Wednesday, June 3rd. The semiconductor manufacturer reported $2.44 EPS for the quarter, topping the consensus estimate of $2.40 by $0.04. Broadcom had a net margin of 36.57% and a return on equity of 38.61%. The firm had revenue of $22.19 billion during the quarter, compared to analysts’ expectations of $22.13 billion. During the same quarter in the prior year, the firm earned $1.58 EPS. Broadcom’s quarterly revenue was up 47.9% on a year-over-year basis. Equities analysts anticipate that Broadcom Inc. will post 9.91 EPS for the current year.

Broadcom Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Tuesday, June 30th. Stockholders of record on Monday, June 22nd will be issued a $0.65 dividend. The ex-dividend date is Monday, June 22nd. This represents a $2.60 annualized dividend and a dividend yield of 0.6%. Broadcom’s dividend payout ratio (DPR) is 50.78%.

Insider Activity at Broadcom

In other news, insider Charlie B. Kawwas sold 39,116 shares of the stock in a transaction that occurred on Tuesday, March 17th. The shares were sold at an average price of $321.61, for a total value of $12,580,096.76. Following the completion of the transaction, the insider directly owned 74,626 shares in the company, valued at $24,000,467.86. This trade represents a 34.39% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, insider S. Ram Velaga sold 38,841 shares of the stock in a transaction that occurred on Tuesday, March 17th. The shares were sold at an average price of $321.60, for a total transaction of $12,491,265.60. Following the completion of the transaction, the insider owned 96,147 shares of the company’s stock, valued at $30,920,875.20. This trade represents a 28.77% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last three months, insiders have sold 324,282 shares of company stock valued at $106,425,249. Insiders own 1.90% of the company’s stock.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently made changes to their positions in the stock. Vanguard Group Inc. boosted its holdings in Broadcom by 0.8% during the fourth quarter. Vanguard Group Inc. now owns 482,707,302 shares of the semiconductor manufacturer’s stock worth $167,064,997,000 after buying an additional 3,919,715 shares in the last quarter. State Street Corp raised its position in shares of Broadcom by 2.7% during the fourth quarter. State Street Corp now owns 190,084,351 shares of the semiconductor manufacturer’s stock worth $65,788,194,000 after purchasing an additional 5,040,801 shares during the period. Geode Capital Management LLC raised its position in shares of Broadcom by 1.4% during the fourth quarter. Geode Capital Management LLC now owns 111,277,280 shares of the semiconductor manufacturer’s stock worth $38,396,634,000 after purchasing an additional 1,548,699 shares during the period. Price T Rowe Associates Inc. MD raised its position in shares of Broadcom by 3.0% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 85,546,083 shares of the semiconductor manufacturer’s stock worth $29,607,500,000 after purchasing an additional 2,491,644 shares during the period. Finally, Norges Bank acquired a new stake in shares of Broadcom during the fourth quarter worth $24,252,196,000. 76.43% of the stock is currently owned by institutional investors.

About Broadcom

Broadcom Inc (NASDAQ: AVGO) is a global technology company that designs, develops and supplies semiconductor and infrastructure software solutions for a broad range of markets. The company’s semiconductor business provides components and systems for wired and wireless communications, enterprise and cloud storage, networking and broadband access, serving original equipment manufacturers, cloud service providers, telecommunications carriers and industrial customers worldwide. Broadcom is headquartered in Irvine, California, and operates globally with research, development and sales organizations across North America, Europe and Asia.

On the semiconductor side, Broadcom’s portfolio includes system-on-chip (SoC) and application-specific integrated circuit (ASIC) solutions, radio-frequency and connectivity components, Ethernet switching and PHY devices, storage adapters and controllers, optical transceivers and other networking silicon.