Broadcom (AVGO) Surged on Robust Earnings and Outlooks

ClearBridge Investments, an investment management company, released its “ClearBridge Dividend Strategy” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The third quarter showed strong performance for the stock market and ClearBridge Dividend Strategy. Although the strategy lagged its S&P 500 Index benchmark in the quarter, it gained from its exposure to AI. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, ClearBridge Dividend Strategy highlighted stocks such as Broadcom Inc. (NASDAQ:AVGO). Broadcom Inc. (NASDAQ:AVGO) designs and develops various semiconductor and infrastructure software solutions. The one-month return of Broadcom Inc. (NASDAQ:AVGO) was -6.75%, and its shares gained 85.34% of their value over the last 52 weeks. On October 7, 2025, Broadcom Inc. (NASDAQ:AVGO) stock closed at $336.41 per share, with a market capitalization of $1.62 trillion.

ClearBridge Dividend Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its third quarter 2025 investor letter:

"During the quarter, we benefited from our positions in Broadcom Inc. (NASDAQ:AVGO) and Oracle, both of which are major players in AI. Our experiences with these two names are emblematic of our broader approach to investing. Each was bought on its own merits, based on a positive assessment of its fundamental outlook married with a constructive underwriting of its risk/reward. We purchased them in 2020, well before AI became an investable theme. Over the years, both companies have executed well in their traditional categories and taken advantage of opportunities in AI as they have unfolded. We could not have predicted the phenomenal courses either has charted in navigating the AI wave, but by investing in great companies with talented management teams, we have profited handsomely. Both stocks surged in September on robust earnings and outlooks."

Broadcom Inc. (NASDAQ:AVGO) is in the 12th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 156 hedge fund portfolios held Broadcom Inc. (NASDAQ:AVGO) at the end of the second quarter, compared to 158 in the previous quarter. In the fiscal third quarter of 2025, Broadcom Inc. (NASDAQ:AVGO) reported record revenue of $16 billion, up 22% year-over-year. While we acknowledge the potential of Broadcom Inc. (NASDAQ:AVGO) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Broadcom Inc. (NASDAQ:AVGO) and shared the list of top stock recommendations you can’t miss amid growing AI bubble fears. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.