Conviction / Shovels
AVGO
Broadcom Inc.
conviction · held at 9.0%
Broadcom designs the custom chips and networking parts the largest cloud companies use to build their own hardware, and it has told investors that business grows from about $56 billion this year to over $100 billion next year. That forecast was left unchanged while the shares fell roughly 15% from their high, and it is backed by signed multi year agreements rather than hopes.
What we judge
The view on expected return from here, 0 to 100.
Whether the thesis could succeed without this company at all. This moves slowly, and only when the company's position genuinely changes.
What we measure
Facts from market data, not judgments.
| Price | $420.74 |
| 30-day move | +13.5% |
| Position in 52-week range | 65 |
| From the 52-week high | -15.0% |
| Average daily volume | $9.2B |
| Weight in the book | 9.0% |
| Since last rebalance | +13.4% |
Why it is in the fund
Thesis
Custom AI accelerators (TPUs for Google, etc.) and networking chips critical for agentic AI data center buildout.
Standing judgment
About 15% off the high at roughly 26.5x forward earnings, having already recovered from 24% down in early July. Next print is 2026-09-02, which is the check on whether the FY27 number is still intact.
What changed, and why
Every move in this number carries the reason it moved. A score does not change without new evidence.
| Date | Conviction | Change | Cause | Evidence |
|---|---|---|---|---|
| 2026-08-05 | 92 | +4 | The custom accelerator pole of the thesis is now contract backed rather than aspirational, and a 15% drawdown against an unchanged FY27 target is the cleanest combination of central role, converging evidence and entry in the fund. | Q2 FY26 reported 2026-06-03: revenue $22.2B (+48% y/y), AI semiconductor revenue $10.8B (+143%), record 67% operating margin. Q3 AI semi guided to $16.0B, FY26 AI semi to about $56B, and the FY27 AI semiconductor target of over $100B was reiterated on the back of multi year agreements with Google, A |
| 2026-08-05 | 88 | flat | first v3 judgment (v2 score was uninformative, see L-001): A booked, customer-named revenue ramp from roughly $56B to over $100B in AI revenue is being priced as if it were a forecast rather than a backlog. | Q2 FY26 revenue $22.2B, up 48% year over year, EPS $1.91; AI semiconductor revenue $10.8B, up 143% year over year; Q3 AI semi guide $16B; Hock Tan reiterated FY26 AI revenue of approximately $56B and FY27 in excess of $100B; six core custom-silicon customers including Google, Meta, OpenAI and Anthro |
| 2026-08-05 | 88 | -9 | first v3 judgment (v2 score was uninformative, see L-001): A booked, customer-named revenue ramp from roughly $56B to over $100B in AI revenue is being priced as if it were a forecast rather than a backlog. | Q2 FY26 revenue $22.2B, up 48% year over year, EPS $1.91; AI semiconductor revenue $10.8B, up 143% year over year; Q3 AI semi guide $16B; Hock Tan reiterated FY26 AI revenue of approximately $56B and FY27 in excess of $100B; six core custom-silicon customers including Google, Meta, OpenAI and Anthro |
| 2026-07-31 | 97 | flat | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-30 | 97 | +1 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-29 | 96 | -2 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-28 | 98 | +1 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-27 | 97 | flat | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-26 | 97 | -1 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-25 | 98 | +1 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-24 | 97 | -1 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-23 | 98 | +2 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-22 | 96 | -1 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-21 | 97 | flat | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-20 | 97 | +3 | migrated from v2 (cause not recorded) | v2 `scores` row |