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Broadcom Inc AVGO

Morningstar Rating
$160.52 +4.54 (2.91%)
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Company Report

Broadcom Is a Diversified Tech Giant With a Wide Moat and Growing AI Upside

Broadcom is an amalgamation of high-value chip and software businesses that on the whole are differentiated and moaty, in our view. Broadcom is a terrific aggregator of firms, big and small. Its ability to acquire and streamline generates strong profits and cash flow, and fuels its robust dividend. We laud the firm for its execution and operating efficiency, which build upon its large organic investment and help it to outperform its end markets organically.

Price vs Fair Value

AVGO is trading at a 583% premium.
Price
$160.52
Fair Value
$181.00
Uncertainty
Medium
1-Star Price
$977.26
5-Star Price
$991.40
Economic Moat
Hkybl
Capital Allocation
Gxftnkqpt

Bulls Say, Bears Say

Bulls

Broadcom is a poster child for operating efficiency. It earns excellent operating margins and generates enormous cash flow. It is particularly strong at acquiring companies and trimming excess expenses.

Bears

Broadcom has sizable exposure to nonmoaty businesses, in our view, like its broadband and storage chips.

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News

Trading Information

Previous Close Price
$155.98
Day Range
$153.90161.51
52-Week Range
$79.51185.16
Bid/Ask
$160.00 / $161.00
Market Cap
$747.20 Bil
Volume/Avg
42,051 / 35.8 Mil

Key Statistics

Price/Earnings (Normalized)
3.69
Price/Sales
16.93
Dividend Yield (Trailing)
1.27%
Dividend Yield (Forward)
1.31%
Total Yield
2.94%

Company Profile

Broadcom is the sixth-largest semiconductor company globally and has expanded into various software businesses, with over $30 billion in annual revenue. It sells 17 core semiconductor product lines across wireless, networking, broadband, storage, and industrial markets. It is primarily a fabless designer but holds some manufacturing in-house, like for its best-of-breed FBAR filters that sell into the Apple iPhone. In software, it sells virtualization, infrastructure, and security software to large enterprises, financial institutions, and governments.Broadcom is the product of consolidation. Its businesses are an amalgamation of former companies like legacy Broadcom and Avago Technologies in chips, as well as Brocade, CA Technologies, and Symantec in software.
Sector
Technology
Industry
Semiconductors
Stock Style Box
Large Growth
Total Number of Employees
20,000

Competitors

Valuation

Metric
AVGO
MRVL
QCOM
Price/Earnings (Normalized)
3.6947.3720.92
Price/Book Value
10.634.088.75
Price/Sales
16.9311.015.93
Price/Cash Flow
33.8043.1421.07
Price/Earnings
AVGO
MRVL
QCOM

Financial Strength

Metric
AVGO
MRVL
QCOM
Quick Ratio
0.761.181.85
Current Ratio
1.251.802.65
Interest Coverage
4.72−2.5312.69
Quick Ratio
AVGO
MRVL
QCOM

Profitability

Metric
AVGO
MRVL
QCOM
Return on Assets (Normalized)
17.62%5.83%14.08%
Return on Equity (Normalized)
48.13%8.30%32.62%
Return on Invested Capital (Normalized)
23.28%7.20%19.56%
Return on Assets
AVGO
MRVL
QCOM
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Semiconductors Industry Comparables

1-Day Chart
Name
Price
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
NVIDIA Corp
NVDA
DwhztdgtmPfyc$3.0 Tril
Taiwan Semiconductor Manufacturing Co Ltd ADR
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RbtmtfmdyWjgf$801.3 Bil
Advanced Micro Devices Inc
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RmgdlvkppKqtzrm$251.8 Bil
Qualcomm Inc
QCOM
LhkqjzwrBshlqb$213.7 Bil
Texas Instruments Inc
TXN
XbgkcfrwdSbtc$187.4 Bil
ARM Holdings PLC ADR
ARM
JcxtjzxBkqjn$165.9 Bil
Intel Corp
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NjrrxgbJvgvd$148.4 Bil
Micron Technology Inc
MU
FxpxgbhjxBshb$130.2 Bil
Analog Devices Inc
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NpckwpzynVfgt$118.6 Bil

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