Broadcom Ltd. (AVGO): Earnings Preview - RBC

November 29, 2016 7:29 AM EST
Get Alerts AVGO Hot Sheet
Price: $180.45 --0%

Rating Summary:
    38 Buy, 2 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 0 | Down: 0 | New: 0
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RBC Capital analyst, Amit Daryanani, reiterated his Outperform rating on shares of Broadcom Limited (NASDAQ: AVGO) as he expects the company to report sizable upside to EPS on its Dec 8th earnings call and update its capital allocation strategy.

The analyst thinks there is a a 50–100% dividend increase coming. Recall that AVGO positively preannounced Oct-qtr revenue of $4.1–4.175B (on 11/2); we think the upside was heavily driven by AAPL demand, while the rest of the business is stable. Incremental upside will be gross/operating margin driven, reflecting revenue synergies and cost take-out benefits. Furthermore, AVGO will use the EPS call to update its capital allocation and our analysis shows that a 50–100% dividend increase is likely to be announced.

Note that this stock is the analyst's top pick. No change to the price target of $190.

For an analyst ratings summary and ratings history on Broadcom Limited click here. For more ratings news on Broadcom Limited click here.

Shares of Broadcom Limited closed at $174.65 yesterday.



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