Broadcom reaches all-time high following strong earnings report

Broadcom’s stock has reached a new milestone by briefly touching $1503.46 following the better-than-expected earnings report for Q1 2024.

• Revenue: $12.49 billion – actual vs $12.03 – expected (LSEG consensus)
• EPS: $10.96 billion – actual vs $10.84 billion – expected (LSEG consensus)
   

The company now expects to reach $51 billion in revenue for the 2024 fiscal year. and has also announced a 10 to 1 stock split, expected to take place on July 15.
 

According to Bloomberg consensus, Broadcom’s stock may grow 19.9% on the 12-month horizon (1793.00 – target price).

Much like its rival Nvidia, Broadcom has too benefited from the AI’s rapid development and widespread public adoption.

According to the company,

• ~$3.1billion in sales revenue during just reported quarter has come from AI products
• Company’s last year $69 billion acquisition – VMware has contributed to a large portion of the company’s revenue. As stated by the company, its total revenue would not be able to reach 43% YoY growth rate and would end up at 12%

From the technical prospective

The company’s stock is trading above all major simple moving averages (21-,50- and 100-period SMAs), underscoring a strong uptrend.

To the upside the briefly touched $1500.00 level is the key short-term target level for the bulls, while to the downside the $1450.00 may provide support if the Broadcom bears try to regain the initiative.

The relative strength index (RSI) is in the overbought zone (>70 – overbought, <30 – oversold), signaling a potential for a technical pullback.