2. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders as of Q4: 161
Zweig-DiMenna Associates’ Equity Stake: $70.80 Million
Broadcom Inc. (NASDAQ:AVGO) is a major global technology company with roots in AT&T, Lucent, and Hewlett-Packard, expanding its presence through strategic acquisitions such as LSI, Brocade, CA Technologies, Symantec’s enterprise security business, and VMware. Headquartered in Palo Alto, California, the company operates in two key segments: products and solutions. Its hardware portfolio includes network storage components for cloud computing, Wi-Fi systems for mobile connectivity, and optical products like LED displays for consumer electronics. On the software front, the company develops mainframe computing tools, business automation software, and cybersecurity solutions.
Broadcom Inc. (NASDAQ:AVGO) delivered strong financial results in Q4 2024, with revenue reaching $14.05 billion, a 51.2% increase from the prior year. Earnings per share rose to $1.42, surpassing analyst expectations of $1.39. The company also distributed a cash dividend of $0.53 per share on September 30, totaling $2.48 billion. For the full fiscal year 2024, Broadcom Inc. (NASDAQ:AVGO) reported record-breaking revenue of $51.6 billion, driven by the successful integration of VMware, which contributed to a significant rise in infrastructure software revenue to $21.5 billion. Meanwhile, semiconductor revenue reached an all-time high of $30.1 billion, fueled by AI-related sales of $12.2 billion—marking a 220% year-over-year increase, largely attributed to the company’s AI XPUs and Ethernet networking portfolio.
In addition to its revenue growth, Broadcom Inc. (NASDAQ:AVGO) saw a 37% rise in adjusted EBITDA to $31.9 billion, with strong free cash flow of $21.9 billion, excluding restructuring costs. As a result, the company announced an 11% increase in its quarterly dividend to $0.59 per share for fiscal 2025, continuing its 14-year streak of annual dividend hikes. Broadcom’s expanding AI-driven semiconductor business and robust infrastructure software segment position it as a compelling investment opportunity. Its strong financial performance, commitment to shareholder returns, and leadership in AI and networking technology make Broadcom Inc. (NASDAQ:AVGO) a top stock choice for long-term growth.
Aristotle Atlantic Core Equity Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its Q4 2024 investor letter:
Broadcom Inc. (NASDAQ:AVGO) contributed to performance in the fourth quarter as the company’s third quarter results demonstrated continuing strength for its AI networking and custom accelerator semiconductor business. The company also gave long-term guidance for the service addressable market (SAM) opportunity for its AI-related business, indicating a market opportunity of $60 billion to $90 billion, which only includes contributions from its current three customers. This long-term outlook for AI semiconductor content exceeded investor expectations. Broadcom’s quarterly results also showed the company is ahead on its VMware integration timeline to achieve $8.5 billion in EBITDA, which will support long-term gross and operating margin expansion for the company.
