Why Are Broadcom (AVGO) Shares Soaring Today

Anthony Lee /
2023/05/23 10:03 am EDT

What Happened:

Shares of fabless chip and software maker Broadcom (NASDAQ:AVGO) jumped 5.41% in the pre-market session after Apple announced a multi-billion dollar deal with the company to secure the supply of critical 5G and wireless components for its devices. The deal involves Broadcom providing Apple with advanced radio frequency (RF) solutions, including FBAR filters that enable high-performance cellular connectivity. After the initial pop the shares cooled down to $683.08, up 0.73% from previous close.

What is the market telling us:

Broadcom's shares are somewhat volatile and over the last year have had 8 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.

Broadcom is up 23.4% since the beginning of the year, Investors who bought $1,000 worth of Broadcom's shares 5 years ago would now be looking at an investment worth $2,840.

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