GARPify · Full Picture
Price is in a range while the multiple cheapens — only possible because the engine is doing the work. Over the past year price +85% decomposes into earnings +147% offset by a multiple -25%. The engine factors (ROIC, FCF, margins) are near their own highs; watch revenue growth, free cash flow margin.
| Factor | Direction | 1-year | 5-year (per yr) |
|---|---|---|---|
| Earnings (EPS) | rising | +147% | +43%/yr |
| Multiple (P/E) | expanding | -25% | +2%/yr |
| = Price | uptrend | +85% | +46%/yr |
How to read it. Every factor reports two things — where it sits in its own history (level) and which way it's moving (direction: up / down / range-bound), sign-unified so up = constructive. Price = earnings × multiple, so the top two rows multiply exactly to the price line. Context rows confirm the engine but don't enter the price math. Sources. YCharts (price, P/E, EPS, ROIC, margins, revenue). Scope. Describes condition across factors — not a score, rating, or buy/sell call.
Before a single number matters, you have to understand what you’d actually own. Peter Lynch put it bluntly: if you can’t explain a business to a twelve-year-old in a minute, you don’t understand it well enough to risk your money on it. So this tab tells the story plainly and objectively — what the company does, how it earns its keep, and why that should last. Your job is the simplest and the hardest task in investing: can you hold the whole thing in your head, and would it make sense to a child? That is the conviction you record at the bottom.
Peter Lynch told investors to buy what they understand. Warren Buffett looked for the toll bridge — the business everyone has to cross. Broadcom is neither. It is something stranger: a company most consumers have never heard of, with a name borrowed from a business it acquired, run by a man who has spent twenty years buying other people's companies and cutting them apart for the cash flow. Its product appears in nothing you can touch and everything you use. Its CEO is 73 years old and shows no sign of slowing down. And its most recent annual report contains a number that looks like a typo — earnings growth of 286 percent — that turns out to be neither a typo nor really earnings growth at all. Its story runs in three movements, and each one sets up a question the rest of this report answers.
In 2005, Hewlett-Packard spun off a piece of itself that nobody much wanted — the semiconductor business that had once been Agilent's, and before that HP's, and before that a thousand engineers in a thousand cubicles making the unglamorous chips that go inside other people's products. Two private equity firms, KKR and Silver Lake, paid $2.7 billion for it and renamed it Avago Technologies. They needed a CEO. They hired a 53-year-old Malaysian-born engineer named Hock Tan, who had spent twenty years as a quiet operator in second-tier chip companies and held a Harvard MBA he rarely mentioned. Nobody outside the industry had heard of him. Nobody inside the industry expected what came next.
Tan had a thesis. Most semiconductor companies, he believed, wasted enormous sums on research that never produced profits — chasing markets that didn't materialize, funding moonshots out of vanity rather than discipline. The right model, he thought, was not invention but acquisition: buy a chip franchise that already worked, fire the salesforce that was too large, fire the engineers working on things nobody had asked for, raise prices on customers who had nowhere else to go, and let the cash flow do what cash flow does. It was an unfashionable thesis. It worked. Avago went public in 2009. By 2016, Tan had executed the most audacious deal of his career — a $37 billion reverse merger with a much larger company called Broadcom Corporation, after which he kept the name because it was more recognizable. From there the cadence accelerated. Brocade in 2017. CA Technologies in 2018. Symantec's enterprise security business in 2019. And then, in 2023, the deal nobody thought he could pull off — VMware, for $69 billion. The largest software acquisition in history. The press called it reckless. Customers called their lawyers. Tan raised prices and the cash flow did what cash flow does.
Today the company he built generates $68 billion of revenue and throws off 42 cents of free cash flow for every dollar that comes in the door. Its margins look like a software franchise. Its scale looks like a semiconductor giant. And somewhere along the way, almost by accident, it became indispensable to artificial intelligence.
Open any market-data terminal in June 2026 and look up Broadcom. The screen will tell you that earnings per share grew 286 percent year-over-year. It will tell you the stock trades at 93 times trailing earnings. Both numbers will sit there in black and white, retrieved from the company's audited financial statements, technically true. Both numbers are useless.
Here is what actually happened. When Broadcom bought VMware in November 2023, the accountants did what accountants must do with a $69 billion acquisition: they took the difference between what was paid and what could be assigned to identifiable assets, and they began amortizing it. Non-cash charges, billions of dollars per year, flowed through the income statement in 2024 and 2025. Reported earnings collapsed — not because the business got worse, but because the accountants were doing their job. Trailing-twelve-month EPS dropped from $3.29 to $1.15. The published P/E ratio, which divides price by those depressed earnings, ballooned to 190. The casual reader, glancing at a stock screen, would have concluded the stock was insanely expensive. The careful reader, doing the work, would have noticed the cash was still flowing.
Then, in the fourth quarter of fiscal 2025, the clock ran out on something even more obscure: a set of statutes of limitations on old tax positions. Broadcom recognized a one-time $2.1 billion non-cash tax benefit. The earnings number jumped. The 286 percent growth headline you see today is not the underlying business growing 286 percent. It is the depressed pre-tax-benefit trailing twelve months being compared to the post-tax-benefit trailing twelve months. The cash didn't change. The accounting did.
Strip all of that away and the picture clarifies. Q1 FY2026 GAAP earnings per share were $1.50, up 32 percent from the same quarter a year earlier. Revenue grew 29 percent to $19.3 billion. AI semiconductor revenue alone grew 106 percent to $8.4 billion, and management has guided to $10.7 billion in Q2. The company generated $8 billion of free cash flow in three months — 41 cents of every revenue dollar — and handed $10.9 billion of it back to shareholders through dividends and buybacks in the same quarter, while authorizing another $10 billion buyback for the rest of the year. The cash flow has never been more visible. The reported earnings have never been more confusing. Most quarterly reports tell a single story. Broadcom's tells two, and you have to know which one is real.
Here is the thing about a great company that everyone has agreed is great. The price tag goes up. Today Broadcom is worth about $2.3 trillion. The market is pricing it at 42 times next year's expected earnings — not the 93 times you see on the screen, but the 42 times that takes the accounting noise out of the calculation. By way of comparison, the broad U.S. stock market trades at about 24 times forward earnings for expected growth of 8 percent. Broadcom trades at 42 times forward earnings for guided growth of 47 percent in the next quarter alone. On those terms, the multiple is defensible. The market is paying up for growth, but it is paying for growth that management has told them is coming and that the cash flow already shows arriving.
Which is to say: the easy money has likely already been made. Three years ago Broadcom traded at 27 times earnings on a depressed multiple, before anyone had connected the dots between AI infrastructure spending and the company's custom-silicon business. An investor who bought then has more than quintupled their money. The investor buying today is buying a company whose excellence is now widely understood and whose stock price reflects that understanding.
For the price to keep working, three things have to happen. AI infrastructure spending by Google, Meta, Amazon, and the other hyperscalers has to keep growing. VMware customers, who are largely locked into long-term contracts but increasingly unhappy about the price increases, have to mostly stay locked in. And Hock Tan — the 73-year-old whose acquisition discipline built this company — has to either keep doing what he has been doing or hand it cleanly to someone who can. None of these things is guaranteed. All of them are plausible. The next seven tabs walk through each one in turn, end with a question you rate yourself, and let you decide what your conviction is worth at this price.
The bottom line. Broadcom is a great company at a price that already reflects most of what makes it great. Light 1 (Great Company) is unambiguous — the operating numbers, the AI position, the cash flow, the management discipline all clear that bar without trying. Light 2 (Fair Price) is the harder light. 42 times forward earnings is rich, and it requires AI demand to keep doing what it has been doing and VMware customers to keep paying what they have been paying. Light 3 (Trend My Friend) is green but stretched. The stock has been in an advance for years — the large majority of its weekly closes have printed above a rising 1-year moving average, and there has been no break in the window. But price today sits roughly 32 percent above that moving average — well into the extended end of its historical range, the kind of gap that healthy uptrends tend to close through a pause or pullback. The honest summary: a quality compounder at a fair-but-full price, in a confirmed but extended uptrend. The path to outperformance from here is narrower than it was two years ago. The path to disappointment is wider than it looks.
The fastest way to lose money in a great business is to own it through a crisis it isn’t built to survive. So this tab starts with the unglamorous question that decides whether you ever reach the good part: if the economy turned hard tomorrow — sales falling, credit drying up — would this company sail through, or be forced to sell assets, cut the dividend, or raise money at the worst possible moment? You’re weighing the debt it carries against the cash it throws off, and whether the one can always cover the other. But strength is not only defense. The same balance sheet that survives a downturn is the one with the firepower to act in it — to keep investing, buy back stock, or make the acquisition weaker rivals can’t afford. The best companies fund their own growth from the cash they generate, without leaning on the market’s goodwill. Strong balance sheets let you sleep; weak ones end the story early.
Warren Buffett's test of a business is not how fast it grows but how durably it earns — whether it is a fortress that compounds capital at high rates and survives whatever the economy throws at it. He looks past the income statement to the balance sheet and the cash: Is there real free cash flow? Is the company drowning in debt, or does it own its own destiny? "The most important thing," in the spirit of his essays, "is to be in businesses with strong, durable economics." So before we celebrate the growth of Broadcom, Buffett would have us check whether the foundation beneath it is sound.
Read each like a price chart. The actual metric (solid line, green when rising / red when falling) is plotted with its trend line (grey dashed) on the same axis. On mean-reverting metrics like margins and returns, a tinted band also marks the level versus the metric's own ten-year median; on cumulative-dollar metrics like free cash flow that band carries no signal, so it's omitted.
Free cash flow has reached $29 billion, up from about $3 billion a decade ago — roughly 27% a year. This is the actual cash left after the company has paid to run and expand itself, and it is the foundation everything else on this page rests on.
About 42 cents of every sales dollar now converts to free cash — a margin most companies never approach. The tinted band marks where it sits against its own ten-year median; well above means the cash engine is running hotter than its own history, not merely bigger.
Return on invested capital is 18% — the business earns back more than its entire invested-capital base in a single year. Buffett's fortress test is exactly this: not how fast a company grows, but how much it earns on the money tied up inside it.
Broadcom Inc. returned about $14 billion to shareholders last year through buybacks and dividends, up from almost nothing five years ago. A balance sheet that can hand back tens of billions and still self-fund a record build-out is the definition of financial firepower.
Putting it together. The four lines describe a balance sheet built like a fortress. The business throws off $29 billion of free cash a year at a 42% margin, earns 18% on the capital it puts to work, and still returned about $14 billion to shareholders — all while carrying essentially no net debt. Each line is rising, and the cash-conversion and return-on-capital lines sit well above their own ten-year medians, so this is a fortress getting stronger, not one coasting on past form. The one caveat is not financial but strategic: a large forward supply commitment, which is less a balance-sheet weakness than a wager on the demand thesis the rest of this report examines. On the question this tab asks — strong enough to survive a storm and fund its own growth? — the answer is unambiguous.
The thesis was set when you decided to own the company; the only question now is whether the latest quarter made it stronger or weaker. Most of what crosses the tape is noise — a penny beat, a soft week, a worrying headline. This tab strips that away and asks what actually moved: did earnings and guidance confirm the story, or crack it? Did the multiple do something the business didn’t? Read it as a standing check on your reasons for owning the company. If those reasons are intact, the day-to-day price is somebody else’s problem.
The recent year quarter by quarter (the cadence we pull), then a year-by-year look further back — each read straight from the verified figures: what the business did and what the market did. Each card carries the three lights for that period: Price and Trend computed from the period’s own data, Quality held at the report’s standing verdict (it is a judgment, not a number that flips each quarter).
Quarterly figures from the trailing-twelve-month pull; annual history from reported full-year figures. Each new quarter adds a full entry up top — metrics from the pull, guidance and thesis check from the earnings release.
Peter Lynch kept it simple: over time, price follows earnings. So the question that matters most is not whether earnings rose last quarter, but whether the growth is real and whether it will keep coming. Real growth comes from selling more, to more customers, at healthy margins. The counterfeit version comes from buybacks flattering the per-share figure, one-time gains, or accounting that quietly borrows from tomorrow. This tab separates the two — is the company genuinely earning more, why, and is that engine of demand, pricing, and operating leverage durable enough to run for years? Trustworthy, growing earnings are the whole game; manufactured ones are a trap dressed up as a trend.
Read it like a price chart. The actual metric (solid line, green when rising / red when falling) is plotted with its moving-average trend line (grey dashed) on the same axis — the fundamental version of a price and its 200-day average. The tag (uptrend / downtrend / range-bound) reads where the actual sits relative to that trend line. On mean-reverting metrics like margins, a tinted band also marks the level versus the metric's own 10-year median; on cumulative-growth metrics like EPS and revenue that band carries no signal, so it's omitted.
Revenue has reached $68B, compounding roughly 20% a year over five years. This is the top line — real customer demand — so its slope is the evidence that the earnings growth is backed by sales the company actually made, not by accounting choices.
Broadcom Inc. now earns $5.13 per share, up from $-0.41 a decade ago — about 28% a year. The actual line rides above its rising 1-year average and is still climbing: the bottom line itself is doing the work, not just the story around it.
Operating margin stands at 42%, up about +10 points over five years, and is still grinding higher. A margin this high means each extra dollar of sales drops heavily to profit, so the expansion multiplies revenue growth on its way down to earnings.
Share count is 4.7B, up about 16% over the past decade. The dilution is mild, so the bulk of per-share growth still comes from the business rather than financial engineering.
Putting it together. The four lines describe an earnings engine running on real fuel: revenue compounding about 20% a year, operating margin still expanding, and a share count that has drifted up only mildly — so earnings per share has grown roughly 28% a year without help from buybacks. Price is simply earnings multiplied by the valuation the market puts on them. Over the past 5 years the stock compounded about +46% a year; of that, earnings supplied +43% a year while the multiple expanded 2% a year (P/E 54 to 60). The most recent year tells the same story — price +85% = earnings +147% with the multiple down 25%. The objective read: the price gains here have been driven by both rising earnings and a richer multiple the market is now paying.
Benjamin Graham imagined the market as a manic-depressive partner, Mr. Market, who shows up each day offering to buy or sell at a different price depending on his mood. Some days he is euphoric and will overpay; other days he is despondent and will hand you a wonderful business for a song. The trick, as Howard Marks teaches, is never to catch his mood — but to use it. This tab reads where sentiment sits today: is the crowd fearful, which can gift a patient owner a bargain, or greedy, which is usually when the most money is lost? You are not here to agree with the mood. You are here to decide whether it is working for you or against you.
Each chart reads like a price chart: the actual multiple (solid line, green rising / red falling) with its 1-year moving average (grey dashed). The amber dashed line is the yardstick — its own 5-year average, or the risk-free rate. This is about what the market pays for the business, not market timing.
The market pays about 60× Broadcom Inc.'s earnings — above its own five-year average of 59× (the dashed line). By its own history that makes the stock look expensive: when the solid line sits below the dashed one, the crowd is paying less for these earnings than it usually has.
Flip the multiple over and those earnings are a 1.7% yield on the price. The dashed line is the 4.5% you could earn risk-free from a 10-year Treasury — so today the stock yields less than government bonds. You're paying up for growth the company hasn't booked yet.
And here is what that mood produces: the share price. Price is simply the earnings multiplied by the multiple on the first chart — when sentiment swings the multiple, this line swings with it, even when the business itself is steady.
Sentiment asks a different question than valuation — not what Broadcom Inc. is worth, but how the crowd feels about owning it. Right now that mood has cooled. The multiple has compressed from its euphoric peaks to 60×, below both its own five-year average of 59× and where its theme peers trade; the earnings yield, at 1.7%, even sits under the 4.5% risk-free rate. The crowd that once paid 100×-plus for the future has stepped back — even as the company kept delivering.
That cooling cuts both ways. Falling enthusiasm for a business that keeps executing is exactly the setup value investors hunt for — being paid less for more. But "everyone already owns it" is its own risk: when a name is this widely held and admired, the marginal buyer is scarce and disappointment has further to fall. Sentiment can keep cooling well past fair.
So the useful read is neither "the crowd is wrong" nor "the crowd is right" — it's that the easy money, made while sentiment was expanding the multiple, is gone. From here the return has to come from earnings, not from the crowd paying up again. The regime history below shows how far the mood pendulum has swung before — and what an unreliable timer it makes.
Broadcom's PE multiple over the past three years tells a story that looks volatile on first inspection but is mostly mechanical once you understand the moving parts. Here are the distinct sentiment phases:
The three-year arc, stripped of accounting noise, is straightforward: Broadcom was re-rated as a primary AI infrastructure beneficiary between mid-2023 and mid-2025, and the forward PE has settled around 42× as the market's working consensus on what continued execution is worth. The wild swings in the TTM PE chart between 22× and 190× are mostly arithmetic — driven by acquisition amortization moving through the denominator — not by genuine swings in market sentiment. For sober analysis, anchor on the forward PE and on what the underlying cash flow is doing.
A wonderful business and a wonderful investment are not the same thing — the difference is the price you pay. Buffett’s line is the whole tab: price is what you pay, value is what you get. Overpay for even a great company and you can wait years for it to grow into the price, earning little while you wait; buy it at a fair price and time works for you instead. This tab sizes up what you are being asked to pay today — against the company’s own history, and against what the future would have to deliver to justify it. The goal is not the cheapest stock on the screen; it is a fair price for a quality business. So, knowing what you now know about the company: would you pay today’s price?
The first two charts hold the multiple fixed and let earnings move — what the price would be at a single P/E (its own average, or its theme's); the green dashed line is today's P/E. The last is the PEG — the multiple against growth — versus the 1.0 fair line.
Hold the multiple at its own five-year average of 58.7× and today's earnings would carry the stock to ~$301 — about -3% above the $310 price, which screens as deeply cheap. But look where the navy line sat in 2021–22, far above the amber: the market was then paying 100×-plus for earnings that hadn't arrived. That euphoria is baked into the 58.7× average, so this line flatters the stock — a maturing company rarely re-rates back to its mania-era multiple. Treat it as the optimistic bound, not fair value.
Anchor instead to the multiple it's drifting toward — its theme peers (ETN, FIX, NVDA, TSM) at a ~38.8× median. On today's earnings that's worth ~$199, a 56% premium to its theme. This is the GARP-honest read: the fade theory holds that a leader's premium erodes toward its peer group as growth slows and competition arrives, so where it trades versus peers tends to stick where its own history doesn't. A 56% discount says the market is pricing Broadcom Inc. more cautiously than the companies sitting right beside it.
PEG ties price to growth — the multiple divided by the growth rate. At ~1.9 it sits well under the 1.0 line Lynch called fair: roughly 190¢ per point of growth. The catch is the denominator. PEG only stays this low while growth stays high; as earnings growth normalizes toward the market, the PEG creeps toward 1 even if the price never moves — the quiet way a dear stock can look cheap.
Three yardsticks, and they disagree in a useful way. Against its own history Broadcom Inc. looks dramatically cheap — about -3% below its five-year-average multiple; against its theme peers it's a more measured 56% premium; on PEG it sits well under the 1.0 fair line. The honest anchor is the middle one: the peer multiple is what a maturing leader actually drifts toward, so a ~56% discount to its theme — not a -3% discount to its own bubble-era average — is the read that holds. Modestly cheap, not a screaming bargain.
Every one of those readings, though, rests on the same foundation: the growth. The discount to peers, the sub-1 PEG, a forward multiple below the trailing one — all of them assume earnings keep compounding near their recent pace. That's the GARP bargain and the GARP risk in one sentence. You aren't paying a premium multiple, but you are paying for the growth to continue, and the fade theory is blunt about the alternative: the multiple can compress faster than earnings grow, and the stock falls even as the business gets bigger. Multiple contraction is the tax on success.
So the question the charts can't answer is the one that matters — how durable is the growth that makes this multiple cheap? That's a judgment about the business, not the price. The calculator below is where you put your own number on it: choose a growth rate and an exit multiple, and see what three years could look like.
You’re not buying a stock here — you’re hiring a team to run your money, and handing it to them for years. So this tab does what any careful employer does before making an offer: it reads the résumé, checks the references, and looks at how they’re paid — tenure and track record, what they did with the cash, whether their incentives point the same way yours do. By the end you’re answering one plain question: would you trust these people with your capital? That is the verdict you record below.
Is the leadership team capable and trustworthy? Hock E. Tan has been CEO since 2006, two decades into a singular tenure. His track record is among the strongest in the semiconductor industry: revenue compounded at 22% per year over the past decade, gross margin expanded from 48% to 65%, free cash flow margin held above 40% through multiple acquisition integrations. He is famously direct on earnings calls, doesn't suffer analyst small talk, and runs the company on a tight P&L discipline that some employees find brutal but shareholders find profitable. CFO Kirsten Spears has held the role through the VMware acquisition and integration; her quarterly disclosures are detailed and her guidance has been conservative enough to be repeatedly beaten. The leadership team is small relative to a $2 trillion company — ten named executives, including segment presidents Charlie Kawwas (Semiconductor Solutions) and Ram Velaga (Infrastructure Software).
Does their tenure and track record inspire confidence? Hock Tan turned 73 in 2025. Succession is the single most important governance question on Broadcom that the company has not publicly addressed in detail. The internal candidates are obvious — Kawwas and Velaga, possibly the CFO — but no public anointing has occurred. The risk is not that Tan retires; the risk is that the playbook he built (cut hard, raise prices on locked-in customers, pursue large accretive deals) requires a particular kind of executive temperament that may not transfer. The acquisition machine specifically depends on Tan's personal relationships with target-company boards and his reputation for closing. A successor who is less willing to make the unpopular cost-cutting decisions would dilute the model. Investors should not own Broadcom assuming Tan stays; they should own it assuming a transition will happen within five years and verify that the bench is being prepared.
What about the board and shareholder alignment? The board is small (ten directors) and includes financial professionals as well as operating veterans. Insider ownership is modest; Tan's personal stake is meaningful but not dominant. Stock-based compensation runs at roughly $2.2 billion per quarter, which is substantial but in line with peers given the company's size. The proxy disclosure quality is solid; executive compensation is tied to revenue and EBITDA growth metrics that align with what shareholders care about. No major governance red flags surface in routine review.
You are hiring this team to steward your capital, so read the résumé: what they did with the cash, whether margins held, and whether they grew the share count or shrank it. Each era is the record, straight from the reported figures — the verdict is yours to draw.
Broadcom guides one quarter at a time — and what stands out is how precisely, and how aggressively, it does it. Rather than offer a vague full-year range, Hock Tan’s team puts out a specific revenue number for the coming quarter and then tends to clear it. The most recent quarter is the case in point: it had guided to about $22.0 billion and delivered $22.2 billion, with its AI-chip revenue ($10.8 billion, up 143%) landing above the company’s own forecast.
For the next quarter, management guided to roughly $29.4 billion in revenue — an 84% jump from a year earlier — and Tan went further, putting a hard number on the part everyone is watching: AI semiconductor revenue growing over 200% to $16 billion. Naming a figure that specific, on that line, is the move of a team that can see its order book and isn’t hedging. The thing to hold in mind is the flip side of that precision: Broadcom’s fortunes are now tightly tied to a handful of large AI customers and the pace of their spending, so the same guidance that looks fearless on the way up would turn quickly if that cycle cooled. So far, the company has earned the benefit of the doubt by beating the number it set, quarter after quarter.
The surest way to protect your capital is to study how you might lose it. Charlie Munger built a career on inversion — solving every problem backwards — and risk is where the habit pays off most: before you tally the ways this company can win, you list the ways it can lose, and single out the ones you could never recover from. This tab works through what would have to go wrong for owning this to be a mistake — a moat that quietly erodes, a balance sheet that cracks under stress, a regulator, a shift in technology, a management misstep — and weighs how likely and how survivable each one really is. The aim is not a business with no risks; none exists. It is to know exactly what you are accepting, so you can answer the question at the bottom with your eyes open: are these risks you can live with?
Charlie Munger's most powerful tool was inversion: "All I want to know is where I'm going to die, so I'll never go there." Rather than ask what makes Broadcom succeed, Munger would have us ask the opposite — what would make it fail? Invert the thesis, find the ways the investment dies, and then judge how likely and how survivable each one is. Poor Charlie's Almanack is built on this discipline: avoid the catastrophic error, and the winning takes care of itself. So we turn the optimism of the prior tabs upside down and ask, honestly, where the danger lies.
Fundamentals tell you what to own; the chart tells you whether the market has come around to your view yet. Price moves through a recognizable rhythm — a long base, a breakout into a sustained advance above a rising 1-year moving average, a topping phase, then decline — because price trends tend to persist once they take hold. This tab is not about predicting the next tick; it is a timing and confirmation check on a thesis you have already built on the business. Is the stock in a healthy advance, price riding above a rising 1-year line with the trend working for you? Or is it breaking down, asking you to be patient and let a new base form? You are not here to trade the wiggles. You are deciding one thing: is the trend on your side, or are you fighting it?
Each chart reads the price action plainly: the actual line (green when rising / red when falling) with its trend line (grey dashed); amber dashed marks the reference (new highs, or flat). This describes where the crowd has price — it is context for the fundamentals, not a trading signal.
The solid line is the share price; the dashed line is its 1-year trend, a moving average. The simplest technical read there is: when price holds above a rising trend line, the stock is in an uptrend. Broadcom Inc. is below its trend and that trend is rising, so by this measure it's in a trading range. That's a description of whether momentum is with the stock or against it — not a signal to act.
This is how far price sits below its own prior peak. At -11% off its high, Broadcom Inc. is in a meaningful pullback. Drawdowns are where opportunity and risk both live — a quality business on sale, or the first leg of a longer decline. The chart can't tell you which; it only shows how deep the dip is against its own history.
Momentum is the past year's price change. At +85% the move is strong. Momentum tends to persist longer than people expect and then turn faster than they like — so read a fading line as a yellow flag worth watching, not as an exit by itself.
Studying trends is at the heart of how GARPify reads a company — and not only here. Every chart in this report is built the same way: an actual line against its own moving average, asking one question — is this measure improving or deteriorating? We ask it of earnings, revenue, margins, returns on capital and the multiple, because a business is a moving thing, and the direction of travel usually tells you more than any single snapshot.
Traditional technical analysis stops at price. It studies the chart and nothing else — the footprints of the crowd, cut off from what the company is actually doing — which is exactly why careful investors distrust it. Our quarrel isn't with reading trends; it's with reading only price. Price is the noisiest line we have, because it reflects mood as much as substance: the same stream of earnings can trade at 30 times or 130 times depending on how the crowd feels that year.
So we treat price as one trend among many, and the least decisive of them. Broadcom Inc.'s price trend can confirm the fundamentals — the business improving and the stock rising with it — or contradict them, a strong company whose chart is in retreat, which is more often an opportunity than a warning. What a price trend cannot do is overrule the trends that actually compound value. Read this tab last, and lightly: the business's trends decide; price only tells you what the crowd has made of them so far. The history below shows how Broadcom Inc.'s past technical phases resolved.
The three-year technical picture, broken down by era:
The bottom-line technical read on AVGO is constructive but stretched. The multi-year advance is intact, the MA continues rising, and the pullback during early-2025 broad-tech weakness held the structural uptrend. But the current ~32% extension above the MA is at the high end of this name's historical range — a real caution rather than a comfort. The risk on the technicals is that a deeper pullback to the MA would represent roughly a 24% drawdown from current levels — manageable for long-term holders, painful for short-term ones. A break of the MA on heavy volume would change the picture and would be the first such signal in years.
This is where it comes together. You have read the business, weighed its strength and its earnings, taken the crowd’s temperature, judged the price, met the people running it, and named what could go wrong. The scorecard below gathers every light you lit along the way; the prompts beneath it make you say the thesis back in your own words — what it does, why the price is wrong, what has to go right, what would make you sell, and how much you’d commit. No one can take this last step for you. Buffett’s filter is the whole point: stay inside your circle of competence, and act only when the answer is a clear yes. So, knowing everything you now know — all in, would you own this?
| Section | Your Rating | Notes |
|---|---|---|
| Rate each section as you read — your results appear here automatically. | ||
Every number in this report is only useful if it changes how you make a decision. Most investors read, nod, and move on. The ones who build wealth over time do something different — they write things down.
Not because writing is the point. Because writing forces you to be honest with yourself. You cannot write "I believe this business will compound at 15% for the next decade" without immediately knowing whether you actually believe it.
These five questions have no right answers. GARPify has no opinion on what you should decide. That is your job. This is just the structure that makes the job easier.
Take ten minutes. Be honest.
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