Broadcom's Positive Q1 Outlook Overcomes Industry Headwinds; Shares Undervalued, FVE Remains $624

Broadcom reported strong fiscal fourth-quarter results in line with our expectations, boosted by healthy networking demand led by cloud and enterprise data center spending. Despite weaker consumer demand, Broadcom’s networking, storage, and broadband business units have proven resilient, and the firm’s execution on its software acquisitions such as Symantec and CA Technologies is also noteworthy. We expect Broadcom’s wireless segment to continue benefiting from Apple’s latest iPhone 14 launch. While management remains positive on networking demand, we expect Broadcom’s recent momentum to begin decelerating in the coming quarters, particularly at enterprise customers amid a shaky macroeconomic climate.