Broadcom Hits All-time High Ahead of Earnings: Will the Rally Continue? How to Position with Options?
Hello I'm Steven. This note focuses on Broadcom’s earnings outlook and pre-earnings options setup.
With Nvidia currently on the back foot, Broadcom has effectively become the leader and bellwether for the semiconductor space, so this print is likely to decide whether the whole group moves higher or rolls over. At the end of the article, we outline what we see as the highest-probability options strategy on Nvidia. ![]()
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Street expectations
For Broadcom’s upcoming quarter, current Street consensus is roughly:
– Revenue: about $17.46–17.48bn, implying roughly 24% YoY growth.
– Adjusted EPS (non-GAAP): about $1.87–1.88, with most forecasts clustered around $1.87 and some outliers up to $1.96, implying ~32% YoY growth (vs. about $1.42 a year ago).
On the structural side, AI-related semiconductor revenue has been the key narrative driver. Over the past several quarters, Broadcom’s “AI semiconductor” revenue has grown rapidly and now exceeds its non-AI semiconductor business. In the company’s own Q4 outlook, AI semiconductor revenue is guided to around $6.1bn, up roughly 66% YoY.
The recent share-price rally is essentially the market pricing in this very strong AI number in advance. Put bluntly: regardless of whether Broadcom ultimately delivers that exact figure, investors are saying, “You guided to it, so for now I’m willing to believe it.”
Broadcom has long traded on a premium multiple. Its P/E ratio often sits in the 35–40x range.
Yet at today’s price, even assuming next year’s multiple expands to ~45x, the market is already pricing in next-year EPS growth of 30%+ versus this year. That is a demanding bar. The flip side is that if management’s 2026 outlook is less upbeat or more conservative than the market hopes, the stock could easily be punished.
Options market signals
From the options side, Broadcom’s expected-move (EM) implied by front-month options is around ±8%.
Looking at the last seven earnings cycles, the post-earnings IV crush has typically been less than 10 volatility points.
Current short-dated IV is elevated but has already rolled over from the highs.
Longer-dated expiries have mostly fallen back below 50%, which means the room for pure short-volatility strategies has narrowed.
Broadcom Options Strategies: Takeaways
(1) Long side
Given this backdrop, the pre-earnings trading bias is tilting back toward the long-vol side. For investors who expect a large move after earnings (up or down), it is reasonable to consider:
– Directional trades: outright at-the-money or slightly out-of-the-money long calls or long puts with 1~2 month to expiry, or
– Non-directional trades: if the direction is uncertain but a big move is expected, a double in-the-money long straddle with expiry of 2~3 months. (Considering in-the-money is to avoid dramatic vega loss caused by IV-Crush...)
(2) Short side
Earlier, Broadcom looked attractive for short put strategies: IV was high and price momentum was strong. However, with the stock now at all-time highs and guidance expectations already quite demanding, it is not ideal to initiate fresh short puts at this level.
Investors who believe the stock is unlikely to continue rallying sharply may instead consider covered call structures, using 2–3 month tenors, and strikes set well above spot (roughly 35–50% out-of-the-money). So that even if the stock grinds higher, there is still substantial room before assignment risk becomes meaningful. Ideally, these are true covered calls, written against existing stock positions.
For those who still want to run a short-put playbook in Broadcom, the more prudent approach is not to chase at current level, but to wait for a pullback and then sell puts at more attractive levels, both in terms of entry price and implied volatility.
NVDA：Other Semi-Stocks Options Positioning
As for the more actively traded Nvidia, unfortunately the stock still looks set to churn sideways.
From an options perspective, the most appropriate approach remains cash-secured “stock-pickup” short puts to harvest time decay. Given where the share price is now, strikes roughly 10–15% below spot with 3–4 months to expiry should be sufficient.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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Prince Cunio : Great analysis! The part about using in-the-money straddles to mitigate IV crush is a pro tip I haven't seen many places mention. Definitely considering this for my AVGO play.
Miriammal : Interesting shift in tone from a few weeks ago when short vol was the play. You're right, with IV rolling over and the stock at ATHs, the setup has changed. Long-vol or directional strategies make more sense pre-earnings now.
Winfred Kaempfer : Completely agree with avoiding short puts at these highs. The risk/reward is skewed. Covered calls on existing shares or waiting for a dip to sell puts is the only sensible premium-selling strategy right now.
M7R :
angel salmeron : good
sunwu79 :![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
K Sun : all these analysis till u paralysis . just follow the market and stop kistfyojg why the stock go down
sunnylim2126 :![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
Kelly5526 : yes. this is my answer.
71732910 : to the moon!