Another leading tech company is getting ready to split its stock in the coming weeks. Broadcom (NASDAQ:AVGO) recently reported second-quarter earnings, beating analyst estimates on both adjusted EPS and revenue. However, that isn’t the only positive development for the semiconductor giant. Indeed, Broadcom is planning a 10-for-1 stock split, scheduled to take effect on July 15.
This news gives investors about one month to stock up on AVGO stock in order to benefit from the split. However, as AVGO currently trades at around $1700 per share, some investors may be more inclined to wait until after the split lowers prices.
What’s Happening With AVGO Stock?
Following Broadcom’s stellar earnings report, AVGO stock has been rising steadily. As of this writing, shares are up more than 12% for the day and look primed to keep rising. Indeed, the company has already proven to be one of the winners of the artificial intelligence (AI) boom. But now that it is gearing up for a stock split, a new class of investors is likely getting ready to trigger a trading frenzy.
A company typically opts for a stock split when shares reach a price considered too high for most retail investors. And, as noted, AVGO stock currently trades at extremely high levels, having risen over 55% year-to-date (YTD).
Even before yesterday’s earnings report, investors had plenty of reason to bet on this company. As InvestorPlace contributor Terel Miles reports:
“Broadcom’s strong foothold in the semiconductor industry, combined with its expertise in the AI network infrastructure, makes it a key enabler of the AI revolution. For instance, its networking solutions are crucial for the efficient transmission of data in AI systems. Its storage solutions, including storage adapters, controllers, and integrated circuits, are essential for managing the vast amounts of data generated by AI applications.”
Most of Wall Street is highly bullish on AVGO stock, with 20 out of 22 analysts on TipRanks maintaining “buy” ratings and forecasting significant upside. Broadcom has demonstrated a clear ability to ride the AI wave that is still minting new market winners. Now, investors who missed the first opportunity to buy in will have a chance to stock up on shares.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
