Key Takeaways
- ARK Invest acquired 57,705 shares of Broadcom valued at $20.5 million in anticipation of its fiscal Q3 earnings release
- The firm liquidated 37,977 AMD shares distributed across four ETFs, totaling approximately $18.2 million in proceeds
- Additional purchases included Cerebras Systems and Cloudflare positions worth a total of $26 million
- Broadcom’s Q3 earnings announcement is scheduled for September 3, with analysts projecting an 83.3% revenue surge year-over-year
- Wall Street analysts rate Broadcom as a Strong Buy on TipRanks, indicating potential gains of 43.4% from present price levels
On Wednesday, August 26, Cathie Wood’s ARK Invest executed a significant portfolio rebalancing, allocating $20.5 million to Broadcom shares while simultaneously divesting $18.2 million in Advanced Micro Devices holdings.
The investment firm accumulated 57,705 shares of Broadcom distributed across several exchange-traded funds. This strategic acquisition occurred just ahead of Broadcom’s scheduled fiscal third-quarter earnings announcement on September 3.
Market analysts anticipate Broadcom’s Q3 revenue will reach $29.24 billion, representing an 83.3% increase compared to the equivalent period last year. The consensus estimate for adjusted earnings per share stands at $3.21, versus $1.69 recorded in the prior-year quarter.
Market participants are particularly focused on Broadcom’s artificial intelligence semiconductor revenue stream. The company has projected this division will generate $16 billion during the quarter, more than doubling the previous year’s results.
Srini Pajjuri, an analyst at RBC Capital, anticipates a modest earnings beat accompanied by upward guidance revisions. He identified robust expansion in Broadcom’s networking division as a critical growth catalyst.
While Pajjuri acknowledged emerging competition in the TPU marketplace from MediaTek and a supply partnership between Google and Marvell, he maintains confidence that Broadcom’s extended contracts and increasing TPU market penetration will sustain the company’s trajectory through the coming years.
According to TipRanks data, Broadcom commands a Strong Buy consensus rating, supported by 24 Buy recommendations and three Hold ratings. The consensus price target of $509.96 implies 43.4% upside potential from current trading levels. The stock has appreciated 3.1% since the beginning of the year.
ARK Continues AMD Reduction Strategy
Concurrent with the Broadcom purchases, ARK Invest continued reducing its exposure to Advanced Micro Devices. The firm divested 37,977 AMD shares spread across four exchange-traded funds, generating approximately $18.2 million in proceeds.
This transaction represents a continuation of recent activity. ARK had previously reduced its AMD position earlier during the same week, signaling a strategic downsizing of the holding.
The portfolio adjustment indicates ARK is reallocating capital within the semiconductor space, demonstrating preference for Broadcom’s artificial intelligence market position over AMD’s offerings.
Additional Portfolio Movements on Wednesday
ARK Invest also acquired 69,585 shares of Cerebras Systems valued at approximately $12.8 million and 47,794 Cloudflare shares worth roughly $13.3 million.
Among the firm’s divestments, ARK sold 181,919 Tempus AI shares generating $12.5 million and offloaded 53,280 Twist Bioscience shares for $8.1 million.
The firm additionally liquidated 14,339 CrowdStrike shares for $2.7 million and 25,009 Robinhood Markets shares totaling $2.8 million.
Smaller transactions included the sale of 14,965 Roblox shares for $585,430 and 25,000 Brera Holdings shares generating $105,500.
These portfolio adjustments occurred on the same day Nvidia unveiled its Q2 FY27 financial results, delivering adjusted earnings per share of $2.22 compared to the consensus estimate of $2.09, accompanied by revenue growth of 106% year-over-year to $96.2 billion.
ARK’s Wednesday trading activity underscores its strategic emphasis on artificial intelligence-focused enterprises, as evidenced by the additions of Broadcom, Cerebras, and Cloudflare to its portfolio holdings.
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