Get 40% Off
⚠ Earnings Alert! Which stocks are poised to surge?
See the stocks on our ProPicks radar. These strategies gained 19.7% year-to-date.
Unlock full list

Broadcom (AVGO) Shares Skyrocket, What You Need To Know

Published 2024-03-01, 03:35 p/m
Updated 2024-03-01, 03:47 p/m
Broadcom (AVGO) Shares Skyrocket, What You Need To Know

Stock Story -

What Happened: Shares of fabless chip and software maker Broadcom (NASDAQ:AVGO) jumped 7.7% in the afternoon session after stocks rallied with the S&P 500 (+0.77%) and NASDAQ (+1.1%), making new 52-week highs to mark a strong start to the new month. Notably, sentiment within the tech space also benefitted from Dell's strong earnings, which highlighted growing demand for its computing solutions, especially its AI-optimized servers.

The company provided some color on the growing interest in its AI solutions, adding, "In Q4, we saw strength across a wider range of customers and geographies within an expanding pipeline. AI-optimized server orders increased by nearly 40% sequentially. We shipped $800 million of AI-optimized servers, and our backlog nearly doubled sequentially, exiting the fiscal year at $2.9 billion. Demand continues to outpace GPU supply, though we are seeing H100 lead times improving. We are also seeing strong interest in orders for AI-optimized servers equipped with the next generation of AI GPUs, including the H200 and the MI300X."

Dell's comments demonstrated the strong interest in these highly specialized computing devices as well as the AI-optimized chips that power them, suggesting it is still early days for innovators within the AI space. This likely drove renewed optimism toward the stocks of some semiconductor manufacturers leading the race to supply AI chips and other related hardware.

Is now the time to buy Broadcom? Find out by reading the original article on StockStory.

What is the market telling us: Broadcom's shares are somewhat volatile and over the last year have had 9 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 9 months ago, when Broadcom gained 8.5% as the company's stock enjoyed bullish sentiments from Wall Street analysts who expect huge potential in the artificial intelligence market.

KeyBanc Capital Markets' John Vinh expects Broadcom to benefit in the near-term from its generative AI capabilities--specifically, its TPU product. JPMorgan (NYSE:JPM)'s Harlan Sur echoed this and praised Broadcom's custom-chip business, which he said is "gaining traction with Google (NASDAQ:GOOGL) for its cutting-edge AI processor chip, TPU."

Broadcom is up 28.5% since the beginning of the year. Investors who bought $1,000 worth of Broadcom's shares 5 years ago would now be looking at an investment worth $5,113.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.