AVGO

BroadcomNasdaqGS:AVGO Stock Report

Market Cap

US$208.3b

7D

1.6%

1Y

40.7%

Updated

18 Sep, 2021

Data

Company Financials +
AVGO fundamental analysis
Snowflake Score
Valuation0/6
Future Growth2/6
Past Performance5/6
Financial Health3/6
Dividends4/6

AVGO Overview

Broadcom Inc. designs, develops, and supplies semiconductor infrastructure software solutions.

Broadcom Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Broadcom
Historical stock prices
Current Share PriceUS$506.00
52 Week HighUS$343.48
52 Week LowUS$510.70
Beta0.96
1 Month Change7.90%
3 Month Change9.17%
1 Year Change40.66%
3 Year Change103.95%
5 Year Change203.63%
Change since IPO3,027.32%

Recent News & Updates

Sep 13

Is Broadcom Stock A Buy Or Sell After Q2 Earnings: It's Fairly Valued Right Now

Broadcom is a formidable semiconductor company that we consider as a true bellwether for the industry. Its business is so well integrated into the internet ecosystem, it should be considered a core holding for semiconductor investors. Despite the secular drivers underpinning the industry's growth, CEO Hock Tan warned of an impending supply glut from 2023. Investors are clearly reminded to take valuations in semiconductor stocks into account. We maintain our neutral rating for now. We will wait for the next retracement to consider adding Broadcom stock.

Sep 05
Is There Now An Opportunity In Broadcom Inc. (NASDAQ:AVGO)?

Is There Now An Opportunity In Broadcom Inc. (NASDAQ:AVGO)?

Let's talk about the popular Broadcom Inc. ( NASDAQ:AVGO ). The company's shares had a relatively subdued couple of...

Sep 01

Broadcom Is Fairly Valued

AVGO has lagged the market over the past six months, after massive gains. Continued rapid earnings growth is needed to justify the current price. The Wall Street consensus remains bullish, but expected price appreciation is modest. The market-implied outlook (derived from options prices) has improved since early in 2021, but does not justify a buy rating. I am maintaining my rating on AVGO at neutral.

Aug 21
Estimating The Fair Value Of Broadcom Inc. (NASDAQ:AVGO)

Estimating The Fair Value Of Broadcom Inc. (NASDAQ:AVGO)

In this article we are going to estimate the intrinsic value of Broadcom Inc. ( NASDAQ:AVGO ) by taking the expected...

Shareholder Returns

AVGOUS SemiconductorUS Market
7D1.6%-0.04%-0.6%
1Y40.7%55.0%33.8%

Return vs Industry: AVGO underperformed the US Semiconductor industry which returned 54.7% over the past year.

Return vs Market: AVGO exceeded the US Market which returned 33.6% over the past year.

Price Volatility

Is AVGO's price volatile compared to industry and market?
AVGO volatility
AVGO Beta0.96
Industry Beta1.23
Market Beta1

Stable Share Price: AVGO is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: AVGO's weekly volatility (2%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
201821,000Hock Tanhttps://www.broadcom.com

Broadcom Inc. designs, develops, and supplies semiconductor infrastructure software solutions. It offers semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products worldwide. The company's infrastructure software solutions enable customers to plan, develop, automate, manage, and secure applications across mainframe, distributed, mobile, and cloud platforms.

Valuation

Is Broadcom undervalued compared to its fair value and its price relative to the market?

36.08x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: AVGO ($506) is trading above our estimate of fair value ($421.84)

Significantly Below Fair Value: AVGO is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: AVGO is poor value based on its PE Ratio (36.1x) compared to the US Semiconductor industry average (28.7x).

PE vs Market: AVGO is poor value based on its PE Ratio (36.1x) compared to the US market (17.8x).


Price to Earnings Growth Ratio

PEG Ratio: AVGO is poor value based on its PEG Ratio (2.9x)


Price to Book Ratio

PB vs Industry: AVGO is overvalued based on its PB Ratio (8.6x) compared to the US Semiconductor industry average (4.6x).


Future Growth

How is Broadcom forecast to perform in the next 1 to 3 years based on estimates from 28 analysts?

12.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AVGO's forecast earnings growth (12.5% per year) is above the savings rate (2%).

Earnings vs Market: AVGO's earnings (12.5% per year) are forecast to grow slower than the US market (14.8% per year).

High Growth Earnings: AVGO's earnings are forecast to grow, but not significantly.

Revenue vs Market: AVGO's revenue (5.3% per year) is forecast to grow slower than the US market (9.7% per year).

High Growth Revenue: AVGO's revenue (5.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AVGO's Return on Equity is forecast to be very high in 3 years time (45.8%).


Past Performance

How has Broadcom performed over the past 5 years?

15.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AVGO has high quality earnings.

Growing Profit Margin: AVGO's current net profit margins (21.8%) are higher than last year (9.6%).


Past Earnings Growth Analysis

Earnings Trend: AVGO has become profitable over the past 5 years, growing earnings by 15.4% per year.

Accelerating Growth: AVGO's earnings growth over the past year (158.5%) exceeds its 5-year average (15.4% per year).

Earnings vs Industry: AVGO earnings growth over the past year (158.5%) exceeded the Semiconductor industry 70.6%.


Return on Equity

High ROE: Whilst AVGO's Return on Equity (24.91%) is high, this metric is skewed due to their high level of debt.


Financial Health

How is Broadcom's financial position?


Financial Position Analysis

Short Term Liabilities: AVGO's short term assets ($15.6B) exceed its short term liabilities ($6.5B).

Long Term Liabilities: AVGO's short term assets ($15.6B) do not cover its long term liabilities ($45.0B).


Debt to Equity History and Analysis

Debt Level: AVGO's debt to equity ratio (165.8%) is considered high.

Reducing Debt: AVGO's debt to equity ratio has increased from 61% to 165.8% over the past 5 years.

Debt Coverage: AVGO's debt is well covered by operating cash flow (33.6%).

Interest Coverage: AVGO's interest payments on its debt are well covered by EBIT (4.2x coverage).


Balance Sheet


Dividend

What is Broadcom current dividend yield, its reliability and sustainability?

2.85%

Current Dividend Yield


Upcoming Dividend Payment

TodaySep 18 2021Ex Dividend DateSep 21 2021Dividend Pay DateSep 30 20219 days from Ex DividendBuy in the next 2 days to receive the upcoming dividend

Dividend Yield vs Market

Notable Dividend: AVGO's dividend (2.85%) is higher than the bottom 25% of dividend payers in the US market (1.34%).

High Dividend: AVGO's dividend (2.85%) is low compared to the top 25% of dividend payers in the US market (3.6%).


Stability and Growth of Payments

Stable Dividend: AVGO's dividends per share have been stable in the past 10 years.

Growing Dividend: AVGO's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (101.8%), AVGO's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AVGO's dividends in 3 years are forecast to be covered by earnings (50.2% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.1yrs

Average management tenure


CEO

Hock Tan (69 yo)

15.5yrs

Tenure

US$3,695,852

Compensation

Mr. Hock E. Tan has been President, Chief Executive Officer and Director at Broadcom Inc. since March 2006. Mr. Tan is President, Chief Executive Officer and Director at Broadcom Corporation and Broadcom T...


CEO Compensation Analysis

Compensation vs Market: Hock's total compensation ($USD3.70M) is below average for companies of similar size in the US market ($USD11.33M).

Compensation vs Earnings: Hock's compensation has increased by more than 20% in the past year.


Leadership Team

Experienced Management: AVGO's management team is considered experienced (3.1 years average tenure).


Board Members

Experienced Board: AVGO's board of directors are not considered experienced ( 2.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: AVGO insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Broadcom Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: Broadcom Inc.
  • Ticker: AVGO
  • Exchange: NasdaqGS
  • Founded: 2018
  • Industry: Semiconductors
  • Sector: Semiconductors
  • Market Cap: US$208.278b
  • Shares outstanding: 411.62m
  • Website: https://www.broadcom.com

Number of Employees


Location

  • Broadcom Inc.
  • 1320 Ridder Park Drive
  • San Jose
  • California
  • 95131-2313
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/09/18 00:51
End of Day Share Price2021/09/17 00:00
Earnings2021/08/01
Annual Earnings2020/11/01


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.