In the latest close session, Broadcom Inc. (AVGO) was up +1.17% at $344.29. The stock outpaced the S&P 500's daily gain of 0.58%. At the same time, the Dow added 0.31%, and the tech-heavy Nasdaq gained 0.89%.
Shares of the chipmaker have appreciated by 0.29% over the course of the past month, outperforming the Computer and Technology sector's loss of 0.5%, and the S&P 500's gain of 0.16%.
The investment community will be paying close attention to the earnings performance of Broadcom Inc. in its upcoming release. In that report, analysts expect Broadcom Inc. to post earnings of $1.87 per share. This would mark year-over-year growth of 31.69%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $17.5 billion, up 24.49% from the year-ago period.
For the full year, the Zacks Consensus Estimates project earnings of $6.73 per share and a revenue of $63.36 billion, demonstrating changes of +38.19% and +22.85%, respectively, from the preceding year.
Any recent changes to analyst estimates for Broadcom Inc. should also be noted by investors. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.11% lower. Broadcom Inc. is currently a Zacks Rank #3 (Hold).
Looking at its valuation, Broadcom Inc. is holding a Forward P/E ratio of 50.58. This signifies a premium in comparison to the average Forward P/E of 39.29 for its industry.
Investors should also note that AVGO has a PEG ratio of 1.54 right now. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Electronics - Semiconductors industry had an average PEG ratio of 1.92 as trading concluded yesterday.
The Electronics - Semiconductors industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 71, positioning it in the top 29% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Broadcom Inc. (AVGO): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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