Broadcom Rebounds as Market Recovers, Target Lowered by Citi

Broadcom stock rose 5.4% amidst market rebound. However, Citigroup analysts have lowered their price target from $220 to $210, citing potential recession and tariff impacts. Despite this, they maintain a buy rating, indicating a potential upside.

Date: 12-04-2025

AI Rating: 5

Broadcom's Recent Performance: Broadcom (NASDAQ: AVGO) saw a recovery of 5.4%, aligning with broader market trends after significant sell-offs. The company's performance has been partially affected due to the heightened tariff rates on China, now reported at 145% which adds to investor uncertainty.

Even with the surge, the stock remains down 22% for 2025, reflecting the broader industry's struggles against economic headwinds. Analysts indicate Broadcom is currently valued at approximately 27 times expected earnings, which raises questions regarding future earnings potential.

Analyst Insights: Citigroup's latest coverage reflects a cautious stance with a lowered price target from $220 to $210. This adjustment indicates that analysts expect a downturn or at least stagnation in earnings amidst a looming economic recession. Nonetheless, the buy rating implies that Citigroup believes the stock could achieve a 15% upwards adjustment to the target price, indicative of some confidence in its resilience despite broader economic challenges.

Potential Impacts on Financial Metrics: The report indicated that Broadcom's potential earnings may be significantly hampered by the effects of tariffs, which could influence profit margins and, consequently, overall net income. However, specific revenue growth figures, earnings per share (EPS), or return on equity (ROE) metrics were not provided in the report, making a precise financial outlook challenging.

This mixed sentiment—paired with the broader market rebound but tempered by cautious analyst sentiments—suggests that investors should weigh the potential risks and rewards associated with Broadcom shares carefully.

Stocks: AVGO