{"id":38655,"date":"2025-04-09T11:38:42","date_gmt":"2025-04-09T11:38:42","guid":{"rendered":"https:\/\/quickassetsmarket.com\/index.php\/2025\/04\/09\/time-to-dump-broadcom-chinas-retaliation-could-hit-chip-demand\/"},"modified":"2025-04-09T11:38:42","modified_gmt":"2025-04-09T11:38:42","slug":"time-to-dump-broadcom-chinas-retaliation-could-hit-chip-demand","status":"publish","type":"post","link":"https:\/\/quickassetsmarket.com\/index.php\/2025\/04\/09\/time-to-dump-broadcom-chinas-retaliation-could-hit-chip-demand\/","title":{"rendered":"Time to dump Broadcom? China\u2019s retaliation could hit chip demand"},"content":{"rendered":"
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Broadcom Inc (NASDAQ: AVGO) continues to struggle as China vowed \u201cresolute and forceful\u201d measures after the US raised its tariffs further<\/a> on imports from Asia\u2019s largest economy to more than 100%.<\/p>\n

Escalating Sino-US trade tensions are meaningful for AVGO as it currently generates some 20% of its overall revenue from Beijing.<\/p>\n

Still, there\u2019s reason to load up on Broadcom stock<\/a> that\u2019s now down more than 35% versus its year-to-date high.<\/p>\n

Broadcom stock is trading at an attractive valuation<\/h2>\n

While there evidently are headwinds facing AVGO, the massive sell-off in the tech stock since the start of this year has turned it quite attractive in terms of valuation.<\/p>\n

Broadcom shares are now going for a forward price-to-sales multiple of less than 15. <\/p>\n

That\u2019s down significantly from Nvidia\u2019s more than 18.<\/p>\n

That\u2019s part of the reason why JPM analysts called Broadcom stock a prime candidate for a \u201crelief rally\u201d in their recent note to clients.<\/p>\n

The investment firm recommends buying AVGO shares on the pullback and sees upside in them to $250 that indicates potential for a more than 60% gain from current levels.<\/p>\n

A dividend yield of 1.51% makes Broadcom Inc all the more attractive to own ahead of an expected tariffs driven recession in the back half of 2025.<\/p>\n

AVGO\u2019s new buyback could help its share price recover<\/h2>\n

Earlier this week, Hock Tan, the chief executive of Broadcom Inc, announced a $10 billion share repurchase programme that he said will be fully executed by the end of this year.<\/p>\n

Tan\u2019s announcement is super positive for AVGO investors as it essentially confirms the company\u2019s management remains confident despite an increasingly challenging macroeconomic backdrop.<\/p>\n

Despite headwinds, Broadcom CEO continues to see strong momentum in the demand for its custom chips that he believes could push the company\u2019s AI revenue up by 50% in 2025<\/a>.<\/p>\n

On the earnings call last month, Tan signalled new customers for the firm\u2019s custom AI accelerators that positions AVGO to go up directly against the artificial intelligence darling, Nvidia.  <\/p>\n

Why Cramer isn\u2019t buying AVGO shares<\/h2>\n

Famed investor Jim Cramer also welcomed Broadcom\u2019s stock buyback announcement in his latest update to members of his Investing Club this week, adding \u201cthis is a great situation.\u201d<\/p>\n

Cramer expects the repurchase programme to put a floor under AVGO share price as it will serve as a consistent buyer even during challenging times.  <\/p>\n

The multinational wouldn\u2019t have announced a sizable buyback like this if it was even a little bit concerned about cash generation through the remainder of 2025, he added.<\/p>\n

That said, the former hedge fund manager confirmed that he won\u2019t be loading up on Broadcom stock at current levels as he already has a big enough position (650 shares\/3.55 weighting) in the AI chipmaker.<\/p>\n

The post Time to dump Broadcom? China\u2019s retaliation could hit chip demand<\/a> appeared first on Invezz<\/a><\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Broadcom Inc (NASDAQ: AVGO) continues to struggle as China vowed \u201cresolute and forceful\u201d measures after the US raised its tariffs further on imports from Asia\u2019s largest economy to more than 100%. Escalating Sino-US trade tensions are meaningful for AVGO as it currently generates some 20% of its overall revenue from Beijing. Still, there\u2019s reason to <\/p>\n","protected":false},"author":1,"featured_media":38656,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":{"0":"post-38655","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-investing"},"_links":{"self":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts\/38655","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/comments?post=38655"}],"version-history":[{"count":0,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts\/38655\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/media\/38656"}],"wp:attachment":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/media?parent=38655"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/categories?post=38655"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/tags?post=38655"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}