Here’s Why Clearbridge Large Cap Value Strategy is Holding Broadcom (AVGO)

ClearBridge Investments, an investment management company, released its “ClearBridge Large Cap Value Strategy” first quarter 2025 investor letter. A copy of the letter can be downloaded here. The S&P 500 Index declined by -4.3% in Q1 2025 due to a tariff war and a shift away from AI-related tech stocks. Amid the tech-led sell-off, the benchmark, the Russell 1000 Value Index, outperformed its growth counterpart in the quarter. Against this backdrop, the strategy underperformed the benchmark in Q1. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, ClearBridge Large Cap Value 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 36.00%, and its shares gained 64.83% of their value over the last 52 weeks. On May 19, 2025, Broadcom Inc. (NASDAQ:AVGO) stock closed at $230.63 per share with a market capitalization of $1.084 trillion.

ClearBridge Large Cap Value Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its Q1 2025 investor letter:

“Despite a selloff in Broadcom Inc. (NASDAQ:AVGO), we maintained our position, as we believe the company is well-positioned to gain share with its AI focused custom application-specific integrated circuit (ASIC) solutions for customers like Alphabet and Meta. These exposures should remain more resilient even if overall AI spending moderates.”

Is Broadcom Inc. (AVGO) the Best Major Stock to Buy According to Billionaires?

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, 161 hedge fund portfolios held Broadcom Inc. (NASDAQ:AVGO) at the end of the fourth quarter, compared to 128 in the third quarter.  While we acknowledge the potential of Broadcom Inc. (NASDAQ:AVGO) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Broadcom Inc. (NASDAQ:AVGO) and shared the list of best unstoppable stocks that pay dividends. In addition, please check out our hedge fund investor letters Q1 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.