Broadcom stock down 11% due to recession fears, but strong portfolio and partnerships

From Nasdaq: 2025-04-23 15:00:00

Broadcom (AVGO) shares have dropped 11.4% in the past month due to fears of a recession following U.S. President Donald Trump’s tariffs on top trading partners. The company generated 20% of net revenues from China in fiscal 2024. Despite the dip, strong portfolio, partnerships, and balance sheet make it an attractive buy.

Broadcom’s innovative ASICs support AI and machine learning, with notable users like Alphabet and Meta Platforms. The company’s next-gen XPUs are set for volume shipment in the second half of fiscal 2025, targeting a Serviceable Addressable Market of $60-90 billion in fiscal 2027. AI revenues are expected to surge in the second quarter of fiscal 2025.

Broadcom’s focus on AI-powered security with updates to VMware vDefend and Symantec Endpoint Security Complete enhances threat prevention. The company’s strong balance sheet allows for consistent dividends and buybacks. Earnings estimates for fiscal 2025 show a 35.52% year-over-year growth trend.

AVGO stock is trading at a premium, reflecting its strong growth potential in the AI space and rich partner base. The company’s Zacks Rank #1 and Growth Score of B offer a favorable investment opportunity. The consensus estimate for second-quarter earnings indicates a 42.73% year-over-year growth.

Experts recommend Broadcom as one of the 7 best stocks for the next 30 days, with a history of outperforming the market by over 2X since 1988. The company’s expanding AI portfolio and partnerships justify its premium valuation. Download the free report for more insights on potential investment opportunities.



Read more at Nasdaq: Broadcom Stock Down 11% in a Month: Should You Buy the Dip?