Has Buying Broadcom Stock’s Dips Paid Off

For questions about this article or underlying research, email [email protected].

Broadcom (AVGO) shares fell 11.2% from their recent high on October 7, 2026, to the close on October 20. The worst of the slide came on October 16, when the stock lost 4.5%, a decline that tempts some investors to buy and others to sell. Broadcom has fallen harder than this before, so how did the investors who bought those earlier falls do a year later?

Broadcom Shares Were Higher A Year After Past Falls

Since 2010, Broadcom has recorded nine sharp falls, with each representing a drop of more than 20% within about six weeks of trading. Seven of those declines happened over a year ago, and the shares traded higher a year later in all seven cases. The median gain over that year was 45%. The other two falls, in January and July 2026, remain too recent to judge.

Realizing that gain meant holding for a year. Along the way, the median buyer waited 275 days, about nine months, for that year's best price, a median 62.3% above the price on the day of the dip. Most buyers initially saw little further downside, as the median lowest close arrived 3.6% below the price on the day of the dip. Yet after the falls of May 2019 and March 2020, the shares slid more than 30% below that price before they recovered.

If you have held Broadcom for years, your biggest question may be taxes, not whether to buy this dip. See how a tax-aware transition works.

Broadcom Is Growing Fast, At A Premium P/E

Broadcom's revenue reached $29.6 billion in fiscal Q3 2026, up 85.5% from a year earlier. Management said AI semiconductor revenue drove the quarter's growth, climbing 221% from a year before, and noted that its six custom-chip customers are accelerating the adoption of custom accelerators. The company also kept more of each dollar: its operating margin widened to 54.3% from 38.1% in the same quarter a year earlier, and it generated $39.4 billion of free cash flow over the last twelve months.

Management expects fiscal Q4 2026 revenue of $34.8 billion, another step up from the quarter just reported, though that figure remains a forecast rather than a finalized result. Buyers pay for that growth. At the October 20 close, Broadcom traded at 41.6 times its last twelve months of earnings, against 23.0 for the S&P 500.

Management raised one concern itself on the fiscal Q3 2026 call: whether customers can put the chips to work on time. Management said land, power and shell for data centers are a big concern, and more than a big concern, because those elements set when the new capacity gets deployed.

What A Broadcom Buyer Today Is Betting On

A buyer today is betting that Broadcom recovers as it did after past falls, with sales rising fast enough to support a P/E well above the broader market's multiple. That recovery can take time: three months after the July 2026 dip, the shares remained 7% below the price on the day of the dip.

Does a business growing this fast give reason to expect Broadcom's past recoveries to repeat? Fourth-quarter revenue against that $34.8 billion guide is the number to watch when Broadcom reports, an event expected on or around December 9, 2026.

Changing Advisors Does Not Have To Mean A Tax Bill

Long-held positions like Broadcom often carry large unrealized gains, which is exactly why many investors stay with an advisor they no longer love. Accounts usually move in kind, without selling, and concentrated low-basis stock can be unwound gradually with exchange funds, charitable trusts, direct indexing and staged sales. Our partner firm will show you how a transition would work for your account.

See My Tax-Aware Transition Plan

Spot an error or want more like this? Tell us in 10 seconds.