Broadcom: Not Out Of The Woods, Just Cheaper (Rating Upgrade)

Tech Stock Pros Investing Group Follow Summary We downgraded Broadcom Inc. to a Sell last quarter based on our belief the stock was stuck in a catch-22. We expected share and/or margin pressure for AVGO as more hyperscalers look to multi-source their custom AI ASIC projects. While the margin decline is confirming our logic, we think accelerating top-line growth can help offset it by driving higher operating margins. The market also helped price in the negatives since last quarter, with the stock down 26% since June, leading us to upgrade the stock to a Hold. We think AVGO stock has minimal near-term downside, but we don't see enough proof it'll outperform the benchmark yet. Looking for a portfolio of ideas like this one? Members of Tech Contrarians get exclusive access to our subscriber-only portfolios. Learn More » dikushin/iStock via Getty Images Investment Thesis Broadcom Inc. ( AVGO ) reported its Q3 '26 earnings after the bell on Wednesday. Our earnings preview that called Broadcom the new Nvidia ( NVDA ) could not have aged better, with Broadcom almost copycatting This article was written by Tech Stock Pros 12.99K Followers Follow Tech Stock Pros is a team of three former technology sector engineers with a long history of investing in the tech sector. They run Tech Contrarians, an investing group providing institutional-level company research to individual investors. Utilizing a live portfolio with quarterly updates, bi-weekly newsletters, and answering questions daily via chat, Tech Stock Pros aims to demystify investing in the technology sector. Learn more. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.