Broadcom Inc. (NASDAQ:AVGO) stock rose nearly 2% in Friday’s premarket session as investors returned to large-cap technology stocks. Nasdaq futures gained 1.19%, while S&P 500 futures advanced 0.55%.
Broadcom Expands VMware Cyber Defenses as AI Threats Grow
Separately, on Thursday, Broadcom announced updates to its VMware vDefend and VMware Avi Load Balancer platforms aimed at strengthening private cloud security and improving operational efficiency.
The release adds AI-powered security automation, native API protection, on-premises malware sandboxing and support for air-gapped environments.
Broadcom also introduced a new deployment workflow designed to reduce advanced threat prevention implementation from months to weeks, along with performance improvements for distributed firewalls and intrusion detection systems.
The updates are available with vDefend SSP 5.2, vDefend 9.1.1, Avi Load Balancer 32.1.4 and vACT 3.0.
Technical Analysis
Broadcom remains in a long-term uptrend despite some near-term volatility.
The stock trades 9.9% above its 20-day simple moving average, 8.7% above its 50-day SMA and 16.9% above its 200-day SMA. That suggests buyers have continued to support the stock on pullbacks.
However, the shorter-term trend remains mixed. The 20-day SMA is below the 50-day SMA, a bearish short-term signal. At the same time, the 50-day SMA remains above the 200-day SMA, preserving the longer-term “golden cross” established in April.
Momentum indicators have improved. The MACD remains above its signal line and the histogram is positive, indicating buying pressure has strengthened in recent sessions.
Traders are watching resistance near $429.50, while key support sits around $370. If Broadcom breaks above resistance, attention could shift toward its 52-week high near $495.
Earnings And Analyst Outlook
Broadcom is scheduled to report earnings on Sept. 2.
Wall Street expects earnings of $3.16 per share on revenue of $29.44 billion, compared with earnings of $1.69 per share and revenue of $15.95 billion a year earlier.
The stock trades at about 70 times earnings, reflecting its premium valuation. Analysts maintain a consensus Buy rating with an average price forecast of $513.68. Recent rating actions include:
- Erste Group downgraded the stock to Hold on July 7.
- UBS maintained its Buy rating and lowered its price forecast to $485 on June 4.
- Bank of America maintained its Buy rating and raised its price forecast to $530 on June 4.
Benzinga Edge Rankings
Broadcom scores well on momentum and quality but screens poorly on value and growth.
Its Momentum score of 82.3 reflects strong relative price performance, while its Quality score of 96.03 points to solid business fundamentals. However, the stock carries a Value score of 5.73 and a Growth score of 28.33, suggesting investors continue to pay a premium for future execution.
ETF Exposure
Broadcom is a major holding in several exchange-traded funds, including:
- Vanguard High Dividend Yield ETF (NYSE:VYM): 8.48% weighting
- Invesco PHLX Semiconductor ETF (NASDAQ:SOXQ): 7.88% weighting
- FT Vest Technology Dividend Target Income ETF (NASDAQ:TDVI): 7.84% weighting
Because of Broadcom’s sizable weightings, fund inflows and outflows can create additional buying or selling pressure in the stock.
Price Action
AVGO Stock Price Activity: Broadcom shares were up 1.65% at $427.51 during premarket trading on Friday, according to Benzinga Pro data.
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