Why Broadcom Stock Sank Today
Key Points
Broadcom stock sank today amid bearish momentum for the broader market.
The company's share price declined in response to bank earnings and news that China may not be taking Nvidia's H200 chips.
- 10 stocks we like better than Broadcom ›
Broadcom (NASDAQ: AVGO) stock got hit with a significant pullback in Wednesday's trading. The company's share price fell 4.1% in the daily session. Meanwhile, the S&P 500 declined 0.6%, and the Nasdaq Composite sank 1%.
Volatility connected to bank stock earnings dragged the market lower, and Broadcom also faced valuation pressures connected to semiconductor industry news. Despite the U.S. government approving the processors for export, China is reportedly blocking Nvidia's H200 chips from being imported into the country.
Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »
Image source: Getty Images.
Broadcom stock slips amid multiple bearish catalysts
The broader market moved lower in Wednesday's trading as investors reacted to earnings reports from banks, macroeconomic reads, and news that China has blocked the import of Nvidia's H200 semiconductors. The export of the H200 chips was recently cleared by the U.S., but it now looks like China may not be taking the processors. Broadcom's connectivity chips are used to link artificial intelligence (AI) processors together to create high-performance servers, and news that China may now be uninterested in the H200 could suggest a weaker growth outlook for the business.
What's next for Broadcom?
Broadcom will likely continue to be the global leader in connectivity chips for the foreseeable future, and it also has related software and service offerings that could continue to support strong sales and earnings growth. On the other hand, the company trades at a highly growth-dependent valuation -- and it's not immune to macroeconomic and geopolitical pressures. The company is currently valued at roughly 33 times this year's expected earnings and 16 times expected sales.
Should you buy stock in Broadcom right now?
Before you buy stock in Broadcom, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Broadcom wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $487,089!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,139,053!*
Now, it’s worth noting Stock Advisor’s total average return is 970% — a market-crushing outperformance compared to 197% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of January 14, 2026.
Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy.
Recommended Articles
