Broadcom Inc (NASDAQ:AVGO) Combines Technical Strength and High Growth Momentum for Investors

Broadcom Inc (NASDAQ:AVGO) has become a notable option for investors using a combined technical and fundamental growth plan. The stock was found through a screening process that joins Mark Minervini’s Trend Template with a High Growth Momentum (HGM) rating, a method made to find equities showing both solid upward price trends and strong underlying business growth. This two-part method confirms selections are not only technically good but also display the earnings and revenue speed typical of market leaders.

Technical Strength: Meeting the Minervini Trend Template

Broadcom meets all the key technical conditions listed in Minervini’s Trend Template, a system created to find stocks in a strong Stage 2 climb. This is important because the template’s rules are made to filter for securities with confirmed momentum and force, raising the chance of a continued uptrend.

• Price Above Key Moving Averages: The current price of $294.91 trades well above its rising 50-day ($279.77), 150-day ($231.30), and 200-day ($222.10) simple moving averages. This order confirms a positive trend across short, intermediate, and long-term timeframes, a basic part of the Trend Template which requires a stock must be in a clear bull market phase.
• Moving Average Order: The 50-day MA is placed above both the 150-day and 200-day MAs, while the 150-day MA also trades above the 200-day MA. This sequential positive order of faster-moving averages above slower ones is a key rule of the template, showing increasing momentum.
• Proximity to Highs: The stock is currently trading within 7% of its 52-week high of $317.35, easily inside the template's requirement of being within 25% of a new high. Stocks near their highs often have the strongest momentum and are usually leaders within their sector.
• Major Recovery: The share price is about 119% above its 52-week low of $134.90, greatly passing the template's minimum requirement of a 30% gain. This shows a forceful recovery and underlying force.
• Superior Relative Strength: With a ChartMill Relative Strength (CRS) score of 93.82, AVGO is doing better than almost 94% of all stocks in the market. Minervini regularly states that the best performers show superior relative strength, as it points to institutional accumulation and market leadership.

Fundamental Force: Qualifying for High Growth Momentum

Beyond its technical skill, Broadcom’s fundamental profile shows the fast growth that high-growth investors look for. The HGM rating of at least 4 mirrors strong speed in profitability and sales.

• Earnings Speed: The company has shown notable and speeding earnings growth. Quarterly EPS growth (Q2Q) has jumped from 17.65% three quarters ago to 44.16% in the most recent quarter. This pattern of speed is a critical filter in growth investing, as it often pulls significant institutional attention and can be a sign of further price gains.
• Strong Sales Growth: Revenue growth stays strong, with the last quarter showing a 20.16% year-over-year increase. This follows even stronger growth in prior quarters (51.20% and 47.27%), showing the company is effectively growing its top line at a fast pace. Continued sales growth is a fundamental part of the strategy, providing the energy for long-term earnings potential.
• Good Profitability: The company keeps up good profit margins, with the last quarter coming in at 33.09%. The ability to change revenue into profit effectively is a key differentiator for high-quality growth companies.
• Positive Estimate Revisions: Analysts have been changing their future estimates upward, with the average next-year revenue estimate increasing by 0.85% over the last three months. Positive revisions often indicate that the underlying business trends are stronger than earlier thought, a good catalyst for the stock price.

Technical Health and Setup Summary

The provided technical analysis report gives a full overview, giving AVGO a perfect technical rating of 10/10, showing outstanding health across all measured metrics. The report notes that both short-term and long-term trends are positive, a very good sign. Furthermore, the stock is given a solid setup rating of 7/10, suggesting that after its recent run, the price is in a time of consolidation, which may offer a possible entry chance for investors. Key support is found around $156.62 from a long-term trendline. For a detailed breakdown of the technical picture, readers can see the full technical analysis report for AVGO.

Conclusion

Broadcom Inc. offers a notable case for investors following a strict growth and momentum strategy. It successfully passes the demanding technical filters of the Minervini Trend Template, confirming its place in a strong uptrend with superior market-relative strength. At the same time, its fundamental profile reveals the forceful earnings and sales speed that describes a high-growth enterprise, making it interesting to investors looking for capital appreciation.

This combination of technical leadership and fundamental force is exactly what the combined screening method aims to find. Investors interested in finding other stocks that meet this strict mix of technical and growth conditions can look at the High Growth Momentum + Trend Template screen for more possible opportunities.

Disclaimer: This article is for informational and educational purposes only and does not constitute investment advice of any kind. The author has no position in AVGO. All investment decisions involve risk, and readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions.