Waterloo Capital Increases Stake in Broadcom by 7% in Q2

Waterloo Capital L.P. has increased its holdings in Broadcom Inc. (NASDAQ: AVGO) by 7.0% during the second quarter of 2023, according to a filing with the Securities and Exchange Commission. The fund now owns 48,361 shares of the semiconductor manufacturer’s stock, having purchased an additional 3,180 shares during the quarter. Broadcom constitutes approximately 1.1% of Waterloo Capital’s overall holdings, making it the firm’s 21st largest investment. As of the latest SEC filing, these shares are valued at around $13,331,000.

Other institutional investors have also adjusted their positions in Broadcom. Brighton Jones LLC, for instance, increased its stake by 21.8% in the fourth quarter of 2022, bringing its total to 29,683 shares, worth about $6,882,000. Revolve Wealth Partners LLC raised its position by 10.4% during the same period, now holding 7,997 shares valued at $1,854,000. Additionally, United Bank significantly boosted its stake by 76.5% in the first quarter of 2023, acquiring 2,339 shares valued at $392,000.

Hedge funds and institutional investors collectively own approximately 76.43% of Broadcom’s stock, indicating strong institutional confidence in the company.

In insider trading news, Broadcom’s insider, Charlie B. Kawwas, sold 3,893 shares on September 17, 2023, at an average price of $347.82, totaling approximately $1,354,063.26. After this transaction, Kawwas still holds 25,295 shares, valued at about $8,798,106.90. This sale represented a 13.34% decrease in his holdings.

Similarly, Director Henry Samueli sold 368,797 shares on September 24, 2023, for approximately $124,620,194.27 at an average price of $337.91. Following this transaction, Samueli retains 37,722,534 shares valued at around $12,746,821,463.94, reflecting a 0.97% reduction in his position. In the past 90 days, company insiders have acquired 3,550 shares valued at $1,227,869 while selling 665,271 shares worth $225,483,192. Currently, insiders own 2.00% of Broadcom’s total stock.

Broadcom recently reported its quarterly earnings on September 4, 2023, announcing earnings of $1.69 per share, surpassing the consensus estimate of $1.66 by $0.03. The company generated revenue of $15.95 billion, exceeding analysts’ expectations of $15.82 billion. Broadcom’s net margin stands at 31.59% with a return on equity of 36.60%. Year-over-year, the company’s revenue has increased by 22.0%, up from $1.24 EPS reported during the same quarter last year.

In addition, Broadcom declared a quarterly dividend of $0.59 per share, which was paid on September 30, 2023. Shareholders on record as of September 22, 2023, received this dividend, resulting in an annualized dividend of $2.36 and a yield of 0.7%. The ex-dividend date was also September 22, 2023, and the company’s dividend payout ratio currently stands at 60.20%.

Recent updates from Wall Street analysts indicate a generally positive outlook for Broadcom. Several analysts have adjusted their ratings on AVGO shares, with Wall Street Zen downgrading the stock from “buy” to “hold.” Conversely, TD Cowen raised its price target from $355.00 to $370.00 and maintained a “buy” rating. Piper Sandler increased its price objective from $315.00 to $375.00, while JPMorgan Chase & Co. and Bank of America both upped their targets to $400.00.

As of now, Broadcom’s stock holds an average rating of “Buy” among analysts, with a consensus target price of $374.21.

Broadcom Inc. designs and supplies a range of semiconductor devices, focusing on complex digital and mixed-signal complementary metal oxide semiconductor-based devices and analog III-V products globally. The company operates through two primary segments: Semiconductor Solutions and Infrastructure Software.