Gains May Be On The Menu For Broadcom Inc. (NASDAQ: AVGO)

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    Capital Research & Management Co. recently announced the acquisition of new stake in Broadcom Inc. (NASDAQ:AVGO). The institutional investor has increased its shareholding in the Technology company by 16.47% to 34.4 million shares with purchase of 4.86 million shares. This fresh investment now brings its stake to 8.55% valued currently at $10.86 billion. In addition, Capital Research & Management Co. raised its holdings by 2.32 million to 29.5 million shares. And BlackRock Fund Advisors has lifted its position by 1.30% or 0.24 million shares – to 18.32 million shares.

    With over 1.56 million Broadcom Inc. (AVGO) shares trading Wednesday and a closing price of $308.85 on the day, the dollar volume was approximately $482.5 million. The shares have shown a negative weekly performance of -2.22% and its price on 07/28/20 gained nearly 0.49%. Currently, there are 401.00M common shares owned by the public and among those 392.01M shares have been available to trade.

    An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 31 analysts who have offered their price forecasts for AVGO have a consensus price objective of $349.72. The analysts have set the share’s price value over the next 12 months at a high of $400.00 and a low of $300.00 should the stock experience a downside. Incidentally, analysts’ outlook for the Broadcom Inc. stock is 2.00 for the next 12 months. The average price target is 11.45% above its last price level and an upside to the estimated low will see the stock lose -2.95% over that period. But an upside of 22.79% will see the stock hit the forecast high price target while mean target price for the stock is $358.00.

    Insiders at the company have transacted a total of 240 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 47 of these insider trades were purchases, accounting for 1,246,138 shares. Insider sales of the common stock occurred on 193 occasions, with total insider shares sold totaling 1,795,815 shares.

    The top 3 mutual fund holders in Broadcom Inc. are Washington Mutual Investors Fund, American Funds Investment Company, and American Funds Growth Fund of Ame. Washington Mutual Investors Fund owns 16.49 million shares of the company’s stock, all valued at over $5.21 billion. The company bought an additional 1.5 million shares recently to bring their total holdings to about 4.10% of the shares outstanding. American Funds Investment Company bought 0.48 million shares to see its total holdings expand to 13.9 million shares valued at over $4.39 billion and representing 3.46% of the shares outstanding. American Funds Growth Fund of Ame sold -0.11 million shares to bring its total holdings to over 11.06 million shares at a value of $3.49 billion. American Funds Growth Fund of Ame now owns shares totaling to 2.75% of the shares outstanding.

    Shares of Broadcom Inc. (NASDAQ: AVGO) opened at $311.18, up $3.83 from a prior closing price of $307.35. However, the script later closed the day at $308.85, up 0.49%. The company’s stock has a 5-day price change of -2.22% and 16.10% over the past three months. AVGO shares are trading -2.74% year to date (YTD), with the 12-month market performance up to 1.86% higher. It has a 12-month low price of $155.67 and touched a high of $331.58 over the same period. Currently, 1.56 million shares have been traded, compared to an average intraday trading volume of 2.29 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by -1.66%, 1.10%, and 5.95% respectively.

    Institutional ownership of Broadcom Inc. (NASDAQ: AVGO) shares accounts for 84.10% of the company’s 401.00M shares outstanding. Mutual fund holders own 26.40%, while other institutional holders and individual stakeholders account for 56.75% and 2.98% respectively.

    It has a market capitalization of $125.18B and a beta (3y monthly) value of 0.90. The stock’s trailing 12-month PE ratio is 55.00, while the earnings-per-share (ttm) stands at $5.59. The company has a PEG of 4.21 and a Quick Ratio of 2.00 with the debt-to-equity ratio at 1.92. Price movements for the stock have been influenced by the stock’s volatility, which stands at 2.03% over the week and 2.21% over the month.

    Analysts forecast that Broadcom Inc. (AVGO) will achieve an EPS of $5.23 for the current quarter, $5.81 for the next quarter and $23.97 for 2021. The lowest estimate earnings-per-share for the quarter is $5.02 while analysts give the company a high EPS estimate of $5.9. Comparatively, EPS for the current quarter was $5.16 a year ago. Earnings per share for the fiscal year are expected to decrease by -44.30%, and 11.71% over the next financial year. EPS should shrink at an annualized rate of 13.05% over the next five years, compared to 41.00% over the past 5-year period.

    If you are looking to buy this stock, then you may note that the average analyst recommendation by 31 brokerage firm advisors rate Broadcom Inc. (AVGO) as a “Moderate Buy” at a consensus score of 2.00. Specifically, 21 Wall Street analysts polled rate the stock as a buy, while 7 of the 31 advise that investors “hold,” and 0 rated it as a “Sell.”

    Looking at the support for the AVGO, a number of firms have released research notes about the stock. Evercore ISI stated their Outperform rating for the stock in a research note on June 26, 2020, with the firm’s price target at $380. Mizuho coverage for the Broadcom Inc. (AVGO) stock in a research note released on June 22, 2020 offered a Buy rating with a price target of $350. Credit Suisse was of a view on June 15, 2020 that the stock is Outperform, while Argus gave the stock Buy rating on June 09, 2020, issuing a price target of $250- $350. Cowen on their part issued Market Perform rating on June 05, 2020.

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