Broadcom (AVGO) Rebounded from Q1 Decline

Mar Vista Investment Partners, LLC, an investment management company, released its “Mar Vista U.S. Quality Premier Strategy” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The first half of 2025 concluded on a remarkable note, with U.S. stocks bouncing back from earlier volatility to reach new record highs. The S&P 500® Index and the Nasdaq Composite led the recovery, both ending the second quarter at all-time peaks. In the second quarter, the strategy returned +14.29% net of fees, compared to +11.10% and +10.94% returns for the Russell 1000 Index and the S&P 500 Index, respectively. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second quarter 2025 investor letter, Mar Vista U.S. Quality Premier 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 10.74%, and its shares gained 61.94% of their value over the last 52 weeks. On July 10, 2025, Broadcom Inc. (NASDAQ:AVGO) stock closed at $275.40 per share, with a market capitalization of $1.294 trillion.

Mar Vista U.S. Quality Premier Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its second quarter 2025 investor letter:

“Broadcom Inc. (NASDAQ:AVGO) shares rebounded from their calendar Q1 decline as investor concerns surrounding Trump-era trade tensions and the risk of suboptimal returns on large-scale AI capex by hyperscalers proved to be overstated. The company delivered a solid fiscal Q2 2025 (April quarter) and guided for accelerating AI semiconductor revenue growth through FY2026.

Broadcom remains the leading provider of custom AI ASICs and continues to diversify its customer base beyond its initial anchor client, Alphabet. It now has three hyperscaler customers in volume production and disclosed that four additional customers are currently designing custom ASICs based on Broadcom’s technology. Management is optimistic that these new design wins will transition to volume production in the coming years. Interest in custom ASICs remains high among hyperscalers, as these chips offer compelling cost and performance advantages over general-purpose GPUs from providers like Nvidia, particularly for specialized compute workloads.”

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A technician working at a magnified microscope, developing a new integrated circuit.

Broadcom Inc. (NASDAQ:AVGO) is in 12th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 158 hedge fund portfolios held Broadcom Inc. (NASDAQ:AVGO) at the end of the first quarter, compared to 161 in the fourth quarter.  In the fiscal second quarter of 2025, Broadcom Inc. (NASDAQ:AVGO) reported record revenue of $15 billion, up 20% year-over-year. While we acknowledge the risk and potential of AVGO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AVGO and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Broadcom Inc. (NASDAQ:AVGO) and shared the list of best semiconductor stocks to buy according to Reddit. ClearBridge Large Cap Growth Strategy initiated a position in Broadcom Inc. (NASDAQ:AVGO) during Q2 2025. In addition, please check out our hedge fund investor letters Q2 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.