Broadcom Stock Outlook Ahead of Third-Quarter Results
Broadcom (AVGO) is set to report third-quarter earnings after Wednesday's close, with its stock currently trading at $370.34 and up 4% from last week’s low. Despite a strong Wall Street consensus—25 buy ratings out of 28—the company faces a money flow warning as major investors are reducing exposure by over 3%. Analysts expect revenue to reach $29.2 billion, slightly below the guidance provided in June. The majority of Broadcom's growth now comes from AI chips, which contribute less profit than its software business. While AI will account for 54% of this quarter’s sales—up from 49% last quarter—the company maintains a consistent margin despite an 84% revenue increase. However, the stock has historically fallen after beating earnings estimates in recent quarters. The broader chip sector is also experiencing outflows, with Chaikin Money Flow negative for most major names. Broadcom's technical chart shows it trading within a descending channel since June, and analysts suggest a close above $376.28 would be needed to break free.
Topics: AI chips analyst expectations Broadcom stock forecast