Yes, Tesla (TSLA) remains one of the Magnificent Seven stocks Nvidia (NVDA) and Alphabet (GOOGL). But top funds continue to devour stocks Broadcom (AVGO) as Tesla continues its decline. Broadcom’s stock now accounts for a greater percentage of the Nasdaq’s market cap than the electric vehicle pioneer.
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Although not considered one of the Magnificent Seven, Broadcom is responsible for 1.9% of the Nasdaq market cap, surpassing Tesla’s 1.6%. And the artificial intelligence player is urging leading money managers to keep their eyes on the AI ​​stocks.
Joining Nvidia, Google, Microsoft (MSFT) and Metaplatforms (META), Broadcom made the list of new purchases by the best investment funds this month. Tesla hasn’t made this screen since August.
In the latest report, the top-performing money managers picked up more than $1.9 billion worth of shares in Broadcom. Nvidia with $12.3 billion, Microsoft with $11.4 billion, Meta with about $7 billion and Alphabet with $3.7 billion also account for the huge capital inflows by these smart money managers.
Broadcom stock also earned a spot on the IBD Big Cap 20, alongside Nvidia and Meta.
Broadcom unveils a slew of AI innovations
Based in Palo Alto, California, Broadcom designs, develops and delivers a broad range of semiconductor, enterprise software and security solutions. From cloud computing and data centers to storage, broadband and networking, AI stocks are helping to power artificial intelligence and other technologies that are integral to today’s world.
Earlier this month, Broadcom and Google Cloud expanded their partnership, with the aim of optimizing Broadcom’s VMware workloads for Google Cloud. The companies will collaborate on go-to-market initiatives and add more Broadcom products and services to Google Cloud Marketplace. Broadcom will also integrate Google Cloud’s generative AI capabilities.
Nvidia also announced its expanded partnership with Google Cloud at the Google Cloud Next ’24 event in Las Vegas.
In March, Broadcom delivered Bailly, the industry’s first co-packaged optical Ethernet switch for customers, delivering 51.2 terabits per second. That same month, the company also expanded its leadership in optical AI components and debuted the WatchTower Platform.
Broadcom says the platform improves business performance by streamlining the identification and resolution of high-priority incidents in the mainframe environment through better visibility across information technology silos.
Broadcom Stock Etches Buy Point in Pressured Market
Individual stocks like Broadcom, Nvidia and Google don’t operate in a vacuum. With the tech-heavy Nasdaq below its 50-day moving average and IBD’s recommended market exposure level down to 20%-40%, Broadcom stock and other leading growth stocks are feeling the pressure.
AI stock has formed a consolidation pattern with a buy point of 1,438.17. While the fundamentals remain intact, the stock fell below its 50-day moving average on Wednesday. The stock is showing signs of resilience, coming off Thursday’s low but remaining below that benchmark. See where Broadcom stock and the market indexes end the week.
Meanwhile, Nvidia’s new flat base also remains intact as shares jump back above the 50-day line. Nvidia rose almost 2% on Thursday. Google shares remain above their 21-day exponential moving average and remain within buy range.
On the other hand, even as Cathie Wood continues to buy Tesla shares, the electric car maker’s shares remain well below their 21-day, 50-day and 200-day moving averages, all of which remain on a downward trend. The EV maker found itself in trouble again on Thursday after being hit with a downgrade of a ‘thesis-changing’ service.
Follow Matthew Galgani on X (formerly Twitter) at @IBD_MGalgani.
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