AVGO Jumped 16% In A Week. What To Do Now?
Broadcom (AVGO) stock is up 16.2% in 5 trading days. Already own the stock? You might want to consider holding it. Planning to buy? Put it on your watch list. Consider the following data:
- Size: A $1.6 Tril company with $57 Bil in revenue currently trading at $345.65.
- Fundamentals: Last 12 month revenue growth of 33.9% and operating margin of 37.5%.
- Liquidity: Has Debt to Equity ratio of 0.04 and Cash to Assets ratio of 0.06
- Valuation: Currently trading at P/E multiple of 126.0 and P/EBIT multiple of 78.3
- Has returned (median) 120% within a year following sharp dips since 2010. See AVGO Dip Buy Analysis.
While we like to ride the momentum if the fundamentals check out – for AVGO, see Buy or Sell AVGO Stock – we are vary of bull traps. Specifically, it is worth trying to answer if things get really bad, and AVGO drops 20-30% to $241.95 levels, will we be able to hold on to the stock? What is the worst case scenario? We call it downturn resilience.
Below is a deep dive into Broadcom (AVGO) downturn resilience – specifically, its performance vs the market during past crises? Turns out, the stock saw an impact slightly worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.
Below are the details, but before that, as a quick background: AVGO provides semiconductor devices and infrastructure software, including set-top box system-on-chips, cable, DSL, and passive optical networking solutions.
2022 Inflation Shock
- AVGO stock fell 36.7% from a high of $67.43 on 27 December 2021 to $42.71 on 14 October 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 18 May 2023
- Since then, the stock increased to a high of $345.65 on 8 September 2025 $345.65
| AVGO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -36.7% | -25.4% |
| Time to Full Recovery | 216 days | 464 days |
2020 Covid Pandemic
- AVGO stock fell 48.3% from a high of $32.47 on 12 February 2020 to $16.79 on 18 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 4 August 2020
| AVGO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -48.3% | -33.9% |
| Time to Full Recovery | 139 days | 148 days |
2018 Correction
- AVGO stock fell 28.9% from a high of $28.46 on 27 November 2017 to $20.25 on 13 July 2018 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 15 March 2019
| AVGO | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -28.9% | -19.8% |
| Time to Full Recovery | 245 days | 120 days |
Worried that AVGO could fall much more? You could take a look at the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.