Wall Street Weighs In on Broadcom Stock Before Earnings

Broadcom's third-quarter earnings are due after Wednesday's market close, with the stock up 4% from its low last week to $370.34.

Despite a notable money flow caution, Wall Street has a Strong Buy rating on the stock, comprising 25 buy recommendations, three holds, and zero sells.

Broadcom shares remain 23% below their June 2 record, having risen 7% year to date, while the PHLX Semiconductor Index has gained 63%.

What Wall Street Expects From the Stock

This quarter marks the final major AI earnings report of the season, following 36 analysts who supported Nvidia ahead of its own results.

Analysts are forecasting revenue of $29.241 billion and adjusted earnings of $3.215 per share.

$AVGO: The most crowded "custom chip relay trade" ahead of earnings.

Review of the previous trading session: AVGO ranked high in ticker mentions on X; the primary driver was not its gains last Friday, but the upcoming post-market earnings release on September 2. MRVL’s… pic.twitter.com/GcKVZuYvBy

— OwenCarter (@OwenCarter_k) September 1, 2026

A single figure stands out. Broadcom disclosed in its second-quarter filing in June that it anticipates around $29.4 billion in revenue for this quarter. Analyst estimates come in just under that company guidance.

That constitutes a weak indicator. Broadcom has surpassed its own projections for eight consecutive quarters, typically prompting analysts to forecast above the company's guidance. This quarter, however, they are below it.

The reason lies in the growth composition. AI chips now drive nearly all of the growth, yet they generate much lower margins for Broadcom compared to its software segment.

AI is expected to contribute $16 billion to this quarter's revenue, representing 54% of the total, compared to 49% in the prior quarter, with that figure including OpenAI's first custom processor.

Broadcom has informed investors that it will maintain a profit of 67 cents per dollar of sales, unchanged from last quarter, even as revenue surges 84%. The company is expanding in size without improving its profitability.

Exceeding estimates has not always spurred gains. According to TipRanks, AVGO stock has surpassed expectations every quarter since 2024, but it declined the following trading session on four occasions, with an average price swing of 10.53%, ranging from a 13.01% drop to a 22.71% advance.

The explanation can be found in ownership figures.

Why Money Is Leaving AVGO Stock

TipRanks rates blogger sentiment at 83% bullish and news sentiment at 0.89 out of 1. Despite that, the platform's top-performing investors reduced their Broadcom holdings by 2.37% over the past 30 days and by 3.06% in the last seven. The pace of sales is accelerating.

This trend extends beyond Broadcom. Chaikin Money Flow, which tracks institutional inflows and outflows, registers negative readings for 10 out of 14 major semiconductor stocks.

The four stocks still in positive territory are outside the AI compute space. The five worst performers all produce AI accelerators, reflecting the same rotation that drew institutional money out of Nvidia in a year when Wall Street has been weighing chip stock selections.

Among those 14 names, AVGO ranks at the bottom with a reading of -0.225.

Broadcom Stock Price Levels to Watch

Since June 3, Broadcom shares have been trending lower within a descending channel. Buying volume did not pick up until August 27.

A daily close above $376.28 is required for confirmation, followed by $398.34 to approach an exit from the channel. A widely followed chart account suggests Broadcom needs a stronger bounce to keep pace with Nvidia and TSMC.

$NVDA $TSM $AVGO

Uncanny isn't it?

Well if AVGO wants to follow in TSM's footsteps and especially in NVDA's footsteps to keep up with the current up trend, we need to see a bigger bounce off the orange trendline.

Can we see a Nvidia type move?

Earnings this Wed after hrs with… pic.twitter.com/2mjXsMuW4t

— Heisenberg (@Mr_Derivatives) August 29, 2026

A downside break would occur quickly. Dropping below $356.62 would open the door to $344.46, and a decline through $334.62 would expose $324.79.

Analyst's View: Broadcom stock exhibits mixed signals heading into Wednesday's earnings. While nearly all analysts label it bullish, major shareholders are gradually reducing their positions. The chart remains indecisive. Consequently, the market's reaction to the earnings report may carry more weight than the actual figures.