Broadcom Stock Nabs Bullish Attention After Beat-and-Raise

Analysts were quick to hike their price targets on AVGO

Deputy Editor
Mar 4, 2022 at 10:22 AM
facebook twitter linkedin


Broadcom Inc (NASDAQ:AVGO) is up 3.1% to trade at $596.78 at last check, following the chipmaker's upbeat fiscal first-quarter earnings and revenue results. The company posted earnings of $8.39 per share on revenue of $7.71 billion, both of which handily trounced Wall Street's expectations. Also boosting Broadcom stock is its strong second-quarter revenue guidance, which beat analysts expectations.

Brokerage firms were quick to dish out bull notes after the event. BofA Global Research chimed in with the highest price-target hike to $775 from $750, while four others raised their price objectives as well. The majority of analysts are optimistic toward AVGO, with 19 of the 23 in coverage rating it a "buy" or better. Plus, the 12-month consensus price price target of $681.10 is a 15.8% premium to current levels.

Today's option pits show calls outpacing puts. So far, 11,000 calls and 4,659 puts have crossed the tape, or six times the intraday average. Most popular is the weekly 3/4 615-strike call, where positions are being opened. This means options traders expect more upside for AVGO by the time the market closes today.

Options traders took a far more bearish stance ahead of the earnings event. Over at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Broadcom stock's 10-day put/call volume ratio of 1.32 sits in the 93rd percentile of its annual range, indicating a healthier-than-usual appetite for long puts in the past two weeks.

On the charts, AVGO stock bounced off the long-supportive 200-day moving average in late January, and went on a run that was cut short around the $615 mark. The equity is looking to extend its winning streak for a third consecutive week today, though it is still down 10.2% in 2022.

 

Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

 
Best stocks for October and worst stocks for October
 


 


 
Special Offers from Schaeffer's Trading Partners