Broadcom Inc. (AVGO) has recently been included in the Zacks.com Most Wanted Stocks list due to its strong performance in the past month. With a 16.3% return compared to the Zacks S&P 500 Composite Index’s 3.5%, the chipmaker is worth considering for investors. The Zacks Electronics – Semiconductors sector, which includes Broadcom Inc., has seen a 6.5% increase over the same period.
To understand where the stock might be headed in the near future, it is essential to focus on fundamental factors, such as earnings estimate revisions. Zacks emphasizes the importance of evaluating a company’s earnings outlook, as it determines the fair value of its stock. When sell-side analysts revise earnings estimates, there is a strong correlation with near-term stock price movements. Broadcom Inc. is expected to report earnings of $11.96 per share for the current quarter, with a year-over-year change of +13.5%.
For the current fiscal year, the consensus earnings estimate for Broadcom Inc. is $47.39, reflecting a +12.2% change from the prior year. Looking ahead to the next fiscal year, the estimated earnings of $59.28 indicate a +25.1% change from the previous year. With a Zacks Rank #3 (Hold), based on recent changes in consensus estimates, Broadcom Inc. shows promise in the near term.
Revenue growth is another crucial factor for evaluating a company’s financial health. Broadcom Inc. has a consensus sales estimate of $12.88 billion for the current quarter, signaling a year-over-year variation of +45.2%. The estimates for the current and next fiscal years stand at $51.26 billion and $59.14 billion, respectively.
In terms of reported results, Broadcom Inc. posted revenue of $12.49 billion in the last quarter, representing a +43% year-over-year change. The company beat consensus EPS estimates in the past four quarters and surpassed revenue estimates each time during this period.
Valuation is a key consideration for investment decisions. Looking at valuation multiples like price-earnings (P/E), price-sales (P/S), and price-cash flow (P/CF) can help determine if a stock is fairly valued. Broadcom Inc. currently has an F rating, indicating a premium valuation compared to its peers.
In conclusion, the performance and outlook of Broadcom Inc. suggest that it may be worth monitoring for potential investment opportunities. The Zacks Rank #3 and strong fundamental factors indicate that the stock could perform in line with the broader market in the short term. For more insights and recommendations, investors can access Zacks Investment Research for the latest updates.
Article Source
https://finance.yahoo.com/news/broadcom-inc-avgo-trending-stock-130016729.html
